Selenium is not just one tool or API but it composes many tools.
If you are beginning with desktop website or mobile website test automation, then you are going to be using WebDriver APIs. WebDriver uses browser automation APIs provided by browser vendors to control browser and run tests. This is as if a real user is operating the browser. Since WebDriver does not require its API to be compiled with application code, it is not intrusive. Hence, you are testing the same application which you push live.
IDE (Integrated Development Environment) is the tool you use to develop your Selenium test cases. It’s an easy-to-use Chrome and Firefox extension and is generally the most efficient way to develop test cases. It records the users' actions in the browser for you, using existing Selenium commands, with parameters defined by the context of that element. This is not only a time-saver but also an excellent way of learning Selenium script syntax.
Selenium Grid allows you to run test cases in different machines across different platforms. The control of triggering the test cases is on the local end, and when the test cases are triggered, they are automatically executed by the remote end.
After the development of the WebDriver tests, you may face the need of running your tests on multiple browser and operating system combinations. This is where Grid comes into the picture.
Selenium is an umbrella project for a range of tools and libraries that enable and support the automation of web browsers.