If you are still confused after reading that, let me offer up a simplified version of what XML is, and what it isn't.
XML is simply a language that was created to allow people to define and describe data. It has no tagset (unlike HTML). You create your own tags, to define information however you like.
Since it is so customizable, it is often used to assist in the transfer of information between systems that aren't natively compatible. Since it is plain text (and not in binary form, such as .doc for example), almost all computer systems can read XML files.
HTML (unlike XML) is used to control the display of information. Tags in HTML do not offer any information as to what is contained between them. For example, <td> doesn't tell you if the data is a phone number, someone's name, etc. It is merely there to tell the client (browser) how to display that information.
XML on the other hand, tells you something about the data in between its tags. For example :
<street>102 Main Street</street>
A human can read that and understand (or atleast have an expectation) as to what data is included in the file.
Hopefully this will clear things up.