The term deciduous refers to plants which drop their leaves for some part of the year. Plants do this for various reasons, the most common of which being to avoid the harsh winds, cold temperatures, and snowload of winter. The necessity of this was proven last weekend when parts of California usually snow-free got several feet of heavy snow dumped on them. All of the evergreen live oaks lost many branches to the storm; the deciduous ones were mostly unaffected. In dry areas, some plants, such as some buckeyes, will lose their leaves during dry season or during drought, to conserve water.
Plants drop their leaves by allowing the cells at the base of their petioles to senesce, or die. The plant also removes all the nutrients from the leaf it can, to sustain it through its dormancy. The green chlorophyll is removed, allowing other pigments to show in the leaf. This is what causes brilliant fall color in some plants. After a plant drops its leaves, it is basically dormant, mostly inactive, waiting for conditions to improve.
Hardwood plants, or dicots, are the most common deciduous plants. However, some conifers, such as larch and dawn redwood, are also deciduous. In addition, there are many hardwoods which are not deciduous.