Themes are a collection of CSS files, .skin files, and images applied to webcontrols on website. Themes do not replace the style sheets. It gives the common looks and feel to all webcontols in a simple way. Its allows to abstract the styles so that it can be reused.
In ASP.Net 2.0, a special folder named App_Themes in the root of your application is used to store themes. Each theme needed for your application is placed in a separate folder within the App_Themes folder.