These are the filters that you are prompted for when you open the report. The types are
1. type in - you can type a string, date, number and so on. and the data matching what you enter at the prompt will be shown in the report.
2. FIle picklist - In a text file with the various criterion for selection. Say you have a column WorkGroup in the report where different workgroups are supervisor, manager, worker. And you want to prompt the user to select a particular workgroup so data corresponding only to that is shown, then you can have a text file with the 3 above mentioned workgroups in it and then make a file picklist and use this text file
3. Report picklist. -Similar to above. Only you include a pre-made report using the fields existing in a catalog
4. Catalog Picklist- Use the field in catalog directly. Say you have a field WorkGroup in a catalog folder. Then use this field in the prompt.
You can even have cascading prompts. ie.say you have a report picklist prompt and this picklist report itself has a prompt Then this prompt/s is executed first and then on the actual report. This can go on.