CGI stands for Common Gateway Interface. It's used to provide interactivity and turn static pages into dynamic ones. For example, forums where posts are entered and replied to, guest books with entries, content management systems (CMS) which pull content in from other sites, etc.
CGI scripts are usually fairly easy to install. Most come with instructions to follow. Follow the instructions, be sure the path to perl is set to #/usr/local/bin/perl in it, upload it in ASCII mode (some files may need binary mode such as graphics), and set your permissions correctly per the instructions. They should be set to 755.
If your script needs a hostname, try "localhost".
You can set permissions by going to Cpanel, click on File Manager, click on the folder icon next to public_html to enter the folder, click on the name of the file or folder, click change permissions, and check the boxes on the permissions you want.
You can also do this via ftp FTP programs differ on how to set permissions but it is generally a setting entitled permissions or CHMOD