Custom server controls allow you to create entirely new controls for use with ASP.NET or to derive from existing controls and extend or modify their functionality.
A custom server control is, in its essence, a class that derives from either the Control or WebControl class of the System.Web.UI namespace, or from one of the classes that derive from these controls. Custom server controls can be used in your ASP.NET Web Forms pages in very much the same way you use the built-in server controls that come with ASP.NET. There are two primary categories of custom server controls:
Rendered controls
Rendered controls consist largely of custom rendering of the text, tags, and any other output you desire, which may be combined with the rendered output of any base class your control is derived from. Rendered controls override the Render method of the control they derive from. This method is called automatically by the page containing the control when it's time for the control output to be displayed.
Compositional controls
Compositional controls get their name from the fact that they are composed of existing controls whose rendered output forms the UI of the custom control. Compositional controls create their constituent controls by overriding the CreateChildControls method of the control they derive from. This method, like the Render method, is automatically called by ASP.NET at the appropriate time.
Text taken from http://oreilly.com/catalog/aspdotnetnut/chapter/ch06.html
