Modules are located in folder "_modules". They have "mod" extension. They are PHP files with reusable embeddable contents. Modules can be embedded everywhere: in areas, in articles and even directly in templates (though it is not recommended, because templates are usually independent from web site contents, and you never know which modules exist on a web site).
For example if you want to create a bunch of embeddable links as a module "menu", you can do this by placing the following content into "_modules\menu.mod":
[LINK art=about]About My Site[/LINK]
[LINK art=help]Help[/LINK]
It is very common to use images inside modules. This can be done using a special plugin IMAGE. Here is the easiest way to do this:
Full module text with image on the left could look like
[IMAGE]menu.png[/IMAGE]
[LINK art=about]About My Site[/LINK]
[LINK art=help]Help[/LINK]
Modules are important elements of a TextCMS web site, but they are implemented as an internal plugin. Please check out the MODULE plugin documentation.