Packages are newer, more tightly integrated versions of Asset packages, able to deliver a wide range of enhancements to Unity through the Package Manager. In the Editor, you can access the Package Manager window through this menu: Window > Package Manager.
When Unity opens a Project, the Unity Package Manager reads the Project manifest (1) to figure out what packages to load in the Project. Then it sends a request (2) to the registry server (3) for each package that appears as a dependency in the manifest. The registry server sends the requested information and data back to the Package Manager (4), which then installs those packages (5) in the Project. Each Project has its own manifest which lists the packages to load as “dependencies” of the Project.