Channels are a specific section within a team to organize the conversations by similar topics, projects, group or whichever you deem required.

Channel can also be changed to private instead of allowing the entire team to access it. 

For an example;

Team Name: Production

Channel 1: General

Channel 2: Engineering

Channel 3: Costing

Channel 4: QC

Channel 5: Prepress

Channel 6: Operations

Channel 7: Store
Channel 8: Production Team events

Channel 9: Management Level Channel

By default, General channel will be created when a Team first gets established.

Do note that you will not be able to rename nor remove General channel.

Creating a new channel

1. Click  next to the Team name.
2. Select Add channel.
3. Provide a name for the new channel. You may also add a description for the channel. I would advise to build channels following the example above by organizing by topics, groups, projects or whichever way you can think of to organize your team. 
4. By default, Standard permissions are selected. You may change it to Private to make it only accessible to certain people in the particular team. This is critical if there are confidential information.
5. Select Automatically show this channel in everyone's channel list if you want this channel to be automatically visible in everyone's channel list.
6. Select Add.

Editing channel details

1. Select  next to the Channel name.
2. Select Edit this channel.
3. Change your desired information and click Save.