Like many object-oriented languages, C# handles errors and abnormal conditions with exceptions. An exception is an object that encapsulates information about an unusual program occurrence.
It is important to distinguish between bugs, errors, and exceptions. A bug is a programmer mistake that should be fixed before the code is shipped. Exceptions are not a protection against bugs. Although a bug might cause an exception to be thrown, you should not rely on exceptions to handle your bugs. Rather, you should fix the bugs.
An error is caused by user action. For example, the user might enter a number where a letter is expected. Once again, an error might cause an exception, but you can prevent that by catching errors with validation code. Whenever possible, errors should be anticipated and prevented.
Even if you remove all bugs and anticipate all user errors, you will still run into predictable but unpreventable problems, such as running out of memory or attempting to open a file that no longer exists. You cannot prevent exceptions, but you can handle them so that they do not bring down your program.
When your program encounters an exceptional circumstance, such as running out of memory, it throws (or "raises") an exception. When an exception is thrown, execution of the current function halts and the stack is unwound until an appropriate exception handler is found.
This means that if the currently running function does not handle the exception, the current function will terminate and the calling function will get a chance to handle the exception. If none of the calling functions handles it, the exception will ultimately be handled by the CLR, which will abruptly terminate your program.
An exception handler is a block of code designed to handle the exception you've thrown. Exception handlers are implemented as catch statements. Ideally, if the exception is caught and handled, the program can fix the problem and continue. Even if your program can't continue, by catching the exception, you have an opportunity to print a meaningful error message and terminate gracefully.
If there is code in your function that must run regardless of whether an exception is encountered (e.g., to release resources you've allocated), you can place that code in a finally block, where it is certain to run, even in the presence of exceptions.