ELI5: What actually is an embassy, what does one do and what is the significance if one closes or is removed?

I've travelled alot and hear on the news about embassy's but I have no Idea what they actually are, what is the the purpose of one, why are they so important, what do it actually mean when one is closed or removed from another country? And are they really that important for diplomacy?

I guess what I'm wanting to know is what is the job of an embassy and why is it so important?