Altars are a place where you do magickal workings at. The altar is like a table, that holds all the tools you need for the working you are doing. It is generally made of wood or a slab, but anything you can come up with will work when you are in need. Which way the altar faces varies from witch to witch. Many like to have their altars facing the east or northeast, where mine faces the north. Some also like to have their altar facing depending on what their working with or even the time of day it is. Most of this is up to personal preference and do what feels right to you!
Placing the altar facing north emphasizes the Goddess, and east the God. It is a common practice to have the altar facing to the northeast. If you are doing a spell and wish to place the altar in the direction appropriate for the purpose of the spell, look at the elements section to see what magicks are related to the element and then the direction of that element.