The University of Oxford is made up of all the colleges combined.
There are lots of them because history.
When you go to Oxford, you are enrolled as a member of both the University as a whole and as a member of a particular college. The organisation of your life at Oxford reflects this dual identity.
Academic departments are centralised, so that most of the time, your lectures and pracs are held together with every other undergraduate doing your subject across the whole university. i.e. just like every other Uni. However, your allocated principal tutor will be someone who is attached to your college. So your tutorials are often based in your college, and you will tend to be tutored by other tutors who have some connection to your principal tutor. Most undergraduate colleges offer most subjects - colleges are not subject specific.
Library facilities are both centralised (the Bodleian is huge, and its buildings pop up all over the place) and devolved - your college will have its own library. So you are likely to spend library time split between the central and your college library.
However, Oxford has no central Students' Union building, centralised catering/food halls, and no Halls of Residence which are open to the whole undergraduate body.
Instead, your college tends to be the "default" setting for eating, hanging out and socialising during the term (although of course, you can easily eat and socialise in other colleges as a guest). Unless you organise your own accommodation, you will also live exclusively in properties owned by your particular college.
This obviously means that there tends to be a strong sense of belonging to a particular college, and that you are more likely to make friendships/emnities with people at your college, rather than people doing your subject.
Hope that helps.