Non-fungibility means to describe the uniqueness of the digital collectible or product that can’t be replaced or exchanged with anything else. For example, one dollar bill is fungible- you can trade one for the other one dollar bill, same way you can trade one bitcoin for the other and that explains fungibility. In both the above scenarios you will have the exact same thing with same value, easily exchangeable.
Non fungible items, products or collectibles are unique and one-of-a-kind, these can’t be exchanged for the other. Here, we can take an example of famous renaissance masterpiece portrait of Monalisa, now this art is one of a kind and can be owned by a single entity at any given point in time, and provenance of the same can be verified. There can be many copies of the artwork but they are not original and hence, have no real value. This artwork is one-of-a-kind, unique and non-fungible.
Let’s put it this way, non-fungible token (NFTs) are digital blockchain tokens that represent ownership of unique items, whether digital or physical. These tokens can represent many kind of digital assets like music, videos, GIFs, games avatars, artwork, different kind of collectibles or any other digital or real world article, these assets are bought & sold online using crypto-assets such a Ether (currency of the Ethereum blockchain) on different NFT marketplaces. Some market places do accept dollars or some kind of fiat currency.