Instead of just controlling a single LED light at a time, you do the same with a whole strip of them. There are different types of LED strips, but they can be distinguished roughly in two types: analogue and digital strips.
While analogue strips are cheaper, they can only change the colour of all LEDs at the same time and need more extra parts to be controlled by an Arduino.
Digital strips on the other hand can change the colour of each LED individually, resulting in these fancy colour gradients or "moving" lights that you often see. This is why they are also called addressable LED strips. Digital strips are more appropriate for the typical interactive project and are therefore recommended.
<aside> ⚠️ LED strips need more power as they get longer. A short strip can be powered by the Arduino alone, while a longer strip might need an additional power supply.
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Guide for WS2812B Addressable RGB LED Strip with Arduino | Random Nerd Tutorials
FastLED LED animation library for Arduino (formerly FastSPI_LED)