Local plugins
General Customisations
Moodle has been designed with extensibility in mind. There are many plug-in points available though out Moodle to allow developers add new functionality to Moodle without modifying core code.
See Make a new plugin for the different plugin types available and documentation on how to develop for them.
local/ folder for 'Hacky' Customisations
Sometimes it is not possible to use the available plug-in points to make your change. In situations like this then the local folder is for you. The idea is that instead of scattering your changes throughout the code base, you put them all in a folder called 'local'. Using this folder means you won't have to deal with merging problems when you upgrade the rest of your moodle installation.
The local folder has some of the plug-in points available which are available to other modules. Perhaps most usefull the local/db/ folder can be used to make database schema changes and custom role permissions.
