Barrels in Minecraft are utility blocks used for item storage, offering 27 inventory slots similar to chests. They require 6 wooden planks and 2 matching wooden slabs to craft. Barrels can be accessed even with a block above them, making them suitable for compact spaces. They can be placed upright or sideways and emit a redstone signal when interacted with. Additionally, placing a Barrel near an unemployed villager can turn them into a fisherman.