Citations are used for a variety of reasons:
It is this last point that is usually of the most importance to the student community. The proper use of citations is integral to avoiding an accusation of plagiarism and upholding academic honesty and integrity.
According to the University of Saskatchewan's Copyright Office, "plagiarism is an ethical offense, which includes use of someone else's work without providing proper attribution and passing it off as your own. Plagiarism does not necessarily include copyright infringement, although it can be used as the basis to charge someone with copyright infringement. Even though copying one sentence, for example, from a short story or an online article is legal under copyright law, it may still qualify as plagiarism from your instructor’s perspective, unless the source has been adequately credited."
Here are some examples from other universities which might help clarify this information for you.
The now-defunct Cooperative Library Instruction Project created this short video to explain why it is important to cite sources when writing a research paper. The video is hosted by the Downs-Jones Library.