User controls in ASP.NET allow encapsulating sections of pages to be registered and used as controls. They are created as ASCX files and cannot be directly requested, instead requiring a containing page. Creating a user control involves building the ASCX file, registering it in a webpage, and registering it in the web configuration file. User controls behave like miniature web forms that can be reused across many pages. They have characteristics like an .ascx extension and control directive instead of page directive.