An envelope is a form of packing. Envelopes are used for sending letters or documents using regular postal mail. Envelopes are usually made of paper or hardened paper.
An envelope may be small enough to make you need to fold the paper going into it, or it can be as large as the paper so that you do not need to fold it. A large envelope is called a manila envelope, usually colored a color in between yellow and orange, and is used to send several pages of papers when a regular envelope would be too small. Another reason a manila envelope would be used would be to send important papers (e.g. birth certificates) that are better left unfolded.
To pay to send the mail, a stamp is usually attached to the envelope.