What is an instance?
Lemmy instances are like email servers.
Imagine my email address is whatever@gmail.com. I can send emails to other addresses on the gmail.com email server. But I can also send email to people who have accounts on the proton.me or outlook.com email servers, for example.
In the same way, my Lemmy account is on the slrpnk.net instance. There are several "solarpunk"-related communities there like !climate@slrpnk.net that I can post to. But I can also post to communities like this one, !newtolemmy@lemmy.ca, which is on the lemmy.ca instance.
In the same way that gmail might block emails from a spam server, a lemmy instance might block interactions with another instance. This is called "defederation". I wouldn't worry about it too much, just use your account for a while to get the hang of things, but if you really want to explore defederation you can do so here: https://defed.xyz/