Smilies are small images that appear in posts. Usually they are small images of faces, and are often used to show emotion.
To use smilies in your posts, you can either click on the smiley you want from the left hand collection, or enter the appropriate series of characters. Common character series are :) for a happy face and :( for a sad face etc.
Another common style for smilie character sequences is :emotion: Examples of this are :wink: for a winking face and :lol: (laugh out loud) for a laughing face , etc.