Shells are recurring items that players can use to fight enemies.
Red Shells are used more commonly in the the Mario Kart franchise. In those games, they can home in on other racers and cause them to spin-out.
Green Shells are the most common types of shells seen in the Mario franchise. They can't home in on enemies, but in Super Mario 64 and Super Mario 64 DS, players can ride atop the shells and knock out enemies.
Blue Shells are, like the Red Shells, seen in Mario Kart games. They home in on the player in first place.