Genre is a term that refers to the categorizing of literature. There are different types of Genres used to classify all kinds of literature.
Genres are all classified under two main headings—fiction and non-fiction. Under these fall other such as fantasy, a type of genre completely unrealistic and made-up. Another example would be mythology or comedy or perhaps historical fiction. Poetry is another very popular genre. All of these styles express literature in a different way and genres help define them clearly.
An example of a book that is fictional would be one of my favorites, the King of the Wind. It is a story about a Moroccan horse and his caretaker, a dumb boy named Agba, who are sent to Europe as a present to a king, and then get sold all over Europe, until the horse is finally, by an accident, recognized as how he truly is—fast, courageous and handsome. It is a fictional story written by Marguerite Henry and I would highly recommend it.
Another example would be Whalesong, a trilogy about whales. The first book covers the life of Hrūna, a Humpback whale, and his journey around the world with his pod. The second covers half the life of his son, Hralekana, a huge white Humpback whale. The third continues the life of Hralekana and ends with a great act of heroism that saves the ocean. These stories are an example of fantasy, since the whales act like humans, with minds of their own.
Genres are perhaps a bit hard to define completely at first. They were for me. But, by and by, one understands them fully.