Taxonomies

You can manage your taxonomies internally in Content Manager or externally in Taxonomy Space. With either method or both in combination, you can define a unified classification system across all of your company's content repositories. Using the taxonomies that you implement, Editors and other non-technical Content Manager users are able to select tags for both internal Keywords and external taxonomy concepts, which classifies the content according to the associated taxonomies.

In Tridion Sites, taxonomies are represented by Categories, both for internal and external taxonomies.

Internal taxonomy
To create internal taxonomies, you create Categories, and then create Keywords within the Categories. For a hierarchical taxonomy, you can define parent and child relationships between Keywords simply by creating them in a nested structure, plus you can manually define additional relationships to other Keywords.
In the Content Delivery environment, you can use internal taxonomies for website navigation and dynamic content assembly. The Taxonomy API, part of the Content Interaction Services, exposes the structure of the taxonomy tree to build navigation and display content based on user context.
External taxonomy
To implement external taxonomies, you also create Categories, which you associate with taxonomies managed in Taxonomy Space. The taxonomy's concepts become available within Content Manager as Concept items, which behave in much the same way as Keywords.
In the Content Delivery environment, you can use the external taxonomies as the basis for faceted-search, a feature that enables website visitors to filter search results through a variety of search criteria (facets based on concepts).