In Java, an exception is an object that represents an error or an exceptional condition that has occurred during the execution of a program. When an exception occurs, it interrupts the normal flow of the program and transfers control to an exception handler. The exception handler is responsible for handling the exception and taking appropriate action, such as logging the error, displaying a message to the user, or aborting the program.

Java provides a built-in mechanism for handling exceptions using the try-catch statement. The try-catch statement consists of a try block, where the code that might throw an exception is enclosed, and a catch block, where the exception is caught and handled. The catch block specifies the type of exception that it can handle, and can include code to handle the exception, such as printing an error message or logging the error.

Here's an example of a try-catch statement:

try {
    // code that might throw an exception
} catch (ExceptionType e) {
    // code to handle the exception
}

There are several types of exceptions in Java, including checked exceptions and unchecked exceptions. Checked exceptions are exceptions that must be caught or declared by the method that throws them. Unchecked exceptions, on the other hand, do not have to be caught or declared. Some examples of unchecked exceptions are NullPointerException, IndexOutOfBoundsException, and IllegalArgumentException.

Java also provides the finally block, which is used to execute code that must be run whether an exception occurs or not. The finally block is usually used to release resources, such as file handles or database connections.

Here's an example of a try-catch-finally statement:

try {
    // code that might throw an exception
} catch (ExceptionType e) {
    // code to handle the exception
} finally {
    // code to release resources
}

In addition to the built-in exceptions, Java also allows you to create your own custom exceptions by extending the Exception class or one of its subclasses. This can be useful when you need to represent a specific type of error or exceptional condition in your application.