Memory is the ability to place information in mental storage so that it can be recalled for use at a later time. Memory is a critical function for learning since intelligence is basically a memory-based process.
Many experts agree that people remember better from experience than by being told something. This is why children are much more likely to learn something if they experience it (i.e. a child who accidentally touches a hot stove will be much more likely not to touch it because she remembers the pain she felt when she touched the stove). Toys that actively engage them in playfully learning something will increase their ability to remember the lessons learned.
Knowledge is more likely to be remembered from repeated lessons. You may notice a toddler continually pull at his cat's tail, even though the cat ends this play with a painless swipe at the toddler. You wonder if your toddler will ever remember that the cat will hit him unless he stops pulling the tail. With time, and enough swats from the cat, the lesson will be remembered, and there will be no more tail pulling.
Examples of Memory at various ages:
A newborn baby hears both her mother and her doctor talking. She remembers her mother's voice from within the womb, and turns toward her mother.
A toddler is asked to draw a circle. He remembers how his mother previously cheered when he randomly scribbled in a circular pattern, a shape his mother said was a circle, and now he intentionally repeats the shape.
A preschooler sees her baby brother has picked up a small button that her mother was looking for earlier. She remembers that her mother was worried that the baby might choke on the missing button and takes it from her brother's hand just as he was about to put it in his mouth.
A high school student recently learned how to drive a stick-shift and is preparing to park. He remembers that the last time he parked, he left the car in gear. This had caused the car to lurch forward the next time he started it. Not wanting to repeat this mistake, he moves the gear stick back and forth, verifying that it is in neutral, before he leaves the car.