SharePoint's Documents Sets are like enhanced versions of folders. As with folders, you primarily use them to group similar documents together. They are enhanced with the ability to have their own metadata, workflows, and home page.
The Document Sets feature is only available with the pay versions of SharePoint Server 2013. To use Document Sets, the feature must be active at the Site Collection level. Once activated, there will be a new Document Set content type in the Site Collection's content type gallery. To best take advantage of the enhancements offered by Document Sets, you should create custom content types that inherit from the Document Set content type.