Dynamic Website are website with Dynamic webpages. Such website contains dynamic content for the users.
When we say "Dynamic Content" we are referring to the webpage content which can be changed by its users as well as author. Some refer them for webpage generated dynamically e.g. using scripts or programs.
Lets look at this webpage. It exists because the author, that's me, wrote this content, but there are options to modify this webpage. For this webpage, the options are :
a) COMMENTS : Users and Authors can post Comments (if allowed),
b) REPLY : Users and Authors can post Reply,
c) HELPFUL : Users can grade each post by clicking on them,
d) FOLLOW : Users can follow the post or author,
e) PHOTO : Users can upload Pictures with their comments (if allowed).
f) RANK : Rank which changes for each user.
Each action will change the content of the webpage e.g. either some comment/reply can be added or the count of helpful/follow will increase. Thus the "Dynamic Content".
You can also say that Dynamic Website are not only informative but also interactive, you can do things and interact with the website contrary to static Website where its only information.
What makes these webpage dynamic is either server side language or client side language. I will explain details about them in other post but in brief, there are scripts or programs which run on the server or client (your browser like Internet Explorer or Google Chrome etc.) and generate the content dynamically. These content are the data which needs to be displayed.
In layman terms they are scripts or codes which either store the data on webpage / template (client side)and show them using client side language or extract the data from a database using server side language . Even the html tags and designs are generated by these server side / client side scripts making website dynamic.