By automating mixes, you can change mix settings over time. For example, you can automatically increase volume during a critical musical passage and later reduce the volume in a gradual fade out. See this video tutorial to watch mix automation in action.
Automation envelopes visually indicate settings at specific points in time, and you can edit them by dragging keyframes on envelope lines. Envelopes are nondestructive, so they don’t change audio files in any way. If you open a file in the Waveform Editor, for example, you don’t hear the effect of any envelopes applied in the Multitrack Editor.