Anyone who's used to working with the previous versions of Joomla! knows the old section—category—article drill. Articles had to be part of a category and categories had to be part of a section. There were no workarounds for this rigid three-level content organization scheme. Sometimes, this required Joomla! users to adapt their content to the system's limitations (or extend Joomla!'s functionality by using more powerful content management extensions, so-called Content Construction Kits or CCKs).
In Joomla! 1.6, the rigid old system has finally been replaced. Sections have gone; there are now only categories, and any category can hold as many levels of subcategories as you need. In the backend, instead of both a Section Manager and a Category Manager, you'll now find only a Category Manager. You can forget the concept of sections altogether; in Joomla!! 1.6 there's no need for them anymore, as they're no longer needed as 'containers' to hold categories...