A wiki template is not really what you would call a "template" in real world. In a wiki, we usually call that a "boilerplate".
What is a Template?
A wiki template is instead an article, just like any other, but with the ability to be 'transcluded' onto other pages. This means that if you have made a table with links for all things concerning a given subject, that could be good for navigating, you can take that table, put it into a template, and then just use a wiki template shortcut to transclude that navigation box on all related articles.
Other uses of the template can be to just add automatic formatting such as styles or classes to text, similar to how CSS works. It could also be a table of stats from the game, which you might want on more than one page.
In some cases, templates can be used with variables, and inside other templates. It might look quite complex, and you shouldn't edit what you don't grasp yourself, but they often save a lot of time in the end, as that work needs not to be re-done again, and can easily be edited on all pages the item is shown.
How does in work?
In order to create a template, you start a new article, and naming it like this: Template:New Template. All the content in that article will then be easily transcluded to any other page through using the code to call it in: {{New Template}}. That template article will then replace the "{{New Template}}" snippet.
You can ask one of the DiabloWiki sysops for more information.