Potentiometers (also referred to by pots) are three-terminal resistors which function as an adjustable voltage divider. The most common application of potentiometers is volume control.
Internally it consists of two resistors in series and the third terminal is a mechanically adjustable wiper which determines the resistance ratio of the first to second resistor. Schematically they are shown by the symbol below and next to it is the common connection setup for volume control where the output is taken off the wiper and the other terminal is grounded.
The relationship between the position of the wiper and the resistance is specified by what is known as the taper of the potentiometer. Most pots have a linear taper where the resistance varies linearly with the distance of the taper. However, for audio applications, we also have pots with a logarithmic taper where the resistance varies logarithmically with the distance of the taper. The reason a logarithmic taper is commonly used for audio applications is that human ears perceive loudness logarithmically.
Electronic potentiometers also exist where the resistance is changed digitally, we will learn more about these in the Digital Electronics and Microcontrollers course :)
Rheostats and Variable Resistors
Rheotstats(Variable Resistors) are two-terminal devices where one connection is made to the wiper and the other to one end of the internal resistance. Moving the wiper changes the series resistance.
Rheostat's were commonly used in households to dim lights but nowadays are replaced by digital methods which are more power efficient.