Apple's iTunes music software offers three kinds of playlists: standard, Smart, and Genius. You can make standard playlists by just dragging and dropping songs from your library, and Genius playlists are made with a single click. Really, the only kind of iTunes playlist where brain cells come in handy are Smart Playlists.
So what exactly is a Smart Playlist? Basically, it's a set of instructions that creates a constantly evolving playlist of music.
iTunes comes preloaded with a few examples you can find in the playlist menu, such as Recently Added, My Top Rated, and Recently Played. You can tell them apart from other playlists because of their purple-ish color and the little cog wheel icon in the center.