It is a file / folder that, when enabled, allow a user to customize the interface of Firefox.

For example, I use tree style tabs, so my tabs are on the right. To remove the standard tab bar, I used the userChrome.css.

/* hides the native tabs */
#TabsToolbar { visibility: collapse !important; }

#sidebar-header {
  visibility: collapse !important;
}

yes, you can.