A target is the chosen object of a spell or effect. A spell or effect that targets will and must use the word "target." Choosing a target is required. For example, has a target of a "nearby unit" and has a target of "nearby site."
The source of the ability, or the caster of the spell, must be in the same region as everything it targets.
When you cast a spell or use an ability that targets, before it even goes on the storyline, you must declare all targets. For example, is a spell that targets, and has an ability that targets.
You must declare a legal target as the effect goes on the storyline, and the legality of the target is checked again when the effect starts to resolve. If you cannot declare a legal target when the spell or ability would be added to the storyline, the spell isn't actually cast and the ability can't be used.
See "Casting Magics" for more details.