An Azure subscription represents a logical container where resources are deployed and managed. It acts as a billing unit; all resources that are deployed within the subscription are billed together under that subscription. It defines the boundary for resource management and usage. Subscriptions are linked to a specific Azure account and are used to group usage and billing data. A management group, on the other hand, is a collection of multiple subscriptions, and an Azure account is an identity that has access to Azure. Understanding the purpose and boundaries of a subscription helps manage costs, resources, and governance effectively.