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Template is the 'presentation layer' of a Joomla website. It usually consists of a file called index.php, which defines the general layout of all of the web pages, and a CSS (Cascading Style Sheet) file to define the formatting to use. You can apply different templates to different menu options if you want to create a different look and feel for certain pages. The template governs where the different module positions will be physically displayed on the screen, what fonts and colours the site will use.
SOURCE: http://www.joomlaresource.com
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