Metaplex is actually not a single contract, but a contract ecosystem, consisting of four contracts that interact with one another. Only one of the contracts (Metaplex) actually knows about the other three, while the others represent primitives in the ecosystem and do not interact with each other at all. First, we'll go over what each contract does at a glance, and then we'll cover the full life cycle of a token becoming an NFT and getting auctioned to see the ecosystem in action. Following that will be modules for each contract.
This is the bedrock contract of the entire ecosystem. All that you need to interact with it is your own mint for which you have the mint authority. It is primarily a "mint decorator." It allows you to decorate your mint with a Metadata PDA that gives it a name, symbol, uri, list of creators with royalty splits, and whether or not it's been sold. You can do this with any mint with any supply. Phantom Wallet uses this Metadata account and it's URI field, which often links to a Manifest.json file of a certain format, to display NFTs in their Collections category on their UI.
Furthermore, if your mint has one token in its supply, you can give it an additional decoration PDA, of type MasterEdition. This PDA denotes the mint as a special type of object that can mint other mints - which we call Editions (as opposed to MasterEditions because they can't print other mints themselves). This makes this mint like the "master records" that record studios used to use to make new copies of records back in the day. The MasterEdition PDA will take away minting and freezing authority from you in the process and will contain information about total supply, maximum possible supply, etc.
The existence of Metadata and its sister PDA MasterEdition makes a very powerful combination for a mint that enables the entire rest of the Metaplex contract stack. Now you can create:
max_supply of 0)max_supply of say 10)max_supply)You can also easily transfer ownership of these PDA records with the updateAuthority key on Metadata between parties, so you can sell printing rights to another party, or just give them the token itself while retaining the printing rights.