CMS is short for Content Management System. A CMS will provide a front end (what the visitor will see), and a back end (what the editor will see). All pages, and blog posts are handled by using a database (usually MySQL). This minimizes the actual demands on storage space with the website making the site with the potential to run faster, and more lean. However, unfortunately in practice, this is not the case. Many front ends are full of white space, and the XHTML code produced is not optimized at all.
As for CMS, I use WordPress with a free theme, and free plugins. There are some features I would like, but for the most part, my site provides a positive experience to people that visits.