Plasmids are small circular DNA molecules occuring in bacteria, which can be exchanged between different cells under natural conditions.
Most of the genetic information contain in bacteria is found in a single, circular chromosome. Plasmids are additional cassettes of information that can divide autonomously and exist in several copies scattered throughout the cell.
Bacterial cells do not need plasmids to survive, but they often contain genes that can give the bacteria some kind of advantage. Plasmids may contain genes needed for coping with challenges like heavy metals or antibiotics.
Plasmids are commonly used as "tools" for genetic engineering: