Drawing of a prism bending light
The glowing, colored strips are a rainbow.
A prism is a special piece of glass, crystal, or plastic that bends light. The light bends (or refracts) because it moves slower in the glass, crystal or plastic than it does in air. If different colors of light move at different speeds, each color bends a different amount. This is dispersion and it splits the light into a band of different colors called a spectrum. This spectrum has the same colors as a rainbow does, because rainbows are made the same way, by bending light. They happen when light is bent by tiny drops of water floating in the air. If the light does not come out when you shine it into the prism, it is called internal reflection.
Some prisms are used to disperse light. Binoculars also use prisms, to reflect light. This lets the tubes of the binoculars be short. Some cameras use a prism to send light to the viewfinder, so the photographer can see what will be photographed.