Broadly, a citation is a reference to a published or unpublished source (not always the original source). More precisely, a citation is an abbreviated alphanumeric expression (e.g. [Newell84]) embedded in the body of an intellectual work that denotes an entry in the bibliographic references section of the work for the purpose of acknowledging the relevance of the works of others to the topic of discussion at the spot where the citation appears. Generally the combination of both the in-body citation and the bibliographic entry constitutes what is commonly thought of as a citation (whereas bibliographic entries by themselves are not).
A prime purpose of a citation is intellectual honesty: to attribute prior or unoriginal work and ideas to the correct sources, and to allow the reader to determine independently whether the referenced material supports the author's argument in the claimed way.
The forms of citations generally subscribe to one of the generally accepted citations systems, such as the Oxford, Harvard, MLA, American Sociological Association (ASA), American Psychological Association (APA), and other citations systems, as their syntactic conventions are widely known and easily interpreted by readers. Each of these citation systems has its respective advantages and disadvantages relative to the trade-offs of being informative (but not too disruptive) and thus should be chosen relative to the needs of the type of publication being crafted. Editors will often specify the citation system to use.
Bibliographies, and other list-like compilations of references, are generally not considered citations because they do not fulfill the true spirit of the term: deliberate acknowledgment by other authors of the priority of one's ideas.