Wounds are special effects that you suffer from, usually as a result of being hit by a successful attack. These cover a range of different things, including physical wounds (such as lost limbs), sensory problems (such as blindness), emotional inflictions (such as temptation) and magical exhaustion (such as burnout).
All wounds are cleared when you die, or when you restore yourself on your home plane. Some wounds (particularly the physical ones) may also be healed with certain class powers, such as Regeneration.
Typing “wounds” allows you to view your current wounds, along with a brief summary of any penalties they may give.