These are the common forms of lights that are used in 3D and how they work.
A ambient light is a low-intensity light that affect the whole scene.
Directional light are useful as outdoor lights or any other light that needs to appear to be really far away. The light has a direction and all the rays from it can be considered parallel. Sunlight is common as a directional light. The intensity of this light does not diminish with distance.
A point light is a light source that radiates equally in all directions from a single point in space. The intensity of the light decreases with the distance.
A spot light emits light from a position in a cone shape. It has a inner cone angle and a other cone angle. Inside the first the light is full brightness and between the inner and other radius the light falloff. The intensity also fall of with distance for this light.
Shading is how often the light calculation is done for a surface.
Phong shading - 1975
Here the normals at the vertices are interpolated and the lighting is calculated for each pixel.
Gouraud shading - 1971
With Goraud shading the lighting is calculated once at each vertex and then interpolated between them.
In flat shading it is done once for each surface using the surface normal. So a triangle will have the same light level all over and look flat and faceted.