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Bound items cannot be sold on the Exchange or traded to another player. Bound items can be sold to Vendors. Items are either Bind on Equip or Bind on Pickup, based on whether it is immediately bound (on pickup) or only when you equip it.
Items can also be bound to a single character or to the account. A character-bound item cannot be passed to anyone else, while an account-bound item can be moved between characters on the same account. Make sure to check this if you are trying to get an item for one of your other characters.
Most Uncommon Rare and Very Rare items are bound items. Some Common items such as Body Armor are Bind on Equip.