A simple static web site consists of a fixed number of pages. When you visit one of those pages you always receive the same content. It may be there is intelligence embedded in the web site in the form of JavaScript, Flash or Silverlight, but essentially the pages delivered are identical.
More complex dynamic web sites consist of a variable number of pages. There will be a fixed number of actual pages types, but each page type may be populated dynamically with variable data from a database. The page you're read now consists of elements written by Yahoo!, elements written by you, elements written by me and elements written by others; these elements are combined dynamically to form the page.