Physical Damage Types describe the nature of the damage that can be dealt by players and mobs. There are three types: Piercing, Slashing, and Crushing. Some entities are able to resist certain damage types, making it difficult or impossible to kill them with certain methods.
Piercing damage is dealt by pointy weapons such as Knives, projectiles like Arrows and Javelins, fanged monsters like Spiders, and Cacti. Skeletons are invulnerable to piercing damage, and Zombies are slightly vulnerable to it.
Slashing damage is dealt by weapons with long sharp edges like Axes and Swords, as well as large Predators like bears and cougars. Creepers are vulnerable to slashing damage.
Crushing damage is dealt by blunt weapons like Hammers and Maces. Zombies deal crushing damage, and are somewhat resistant to it. Creepers also resist some crushing damage. Skeletons are vulnerable to it.
Armor has its own set of damage resistances. These resistances scale with the quality of armor, but may differ among armors of the same tier. Among bronzes, Bismuth Bronze armor is best at resisting Crushing, Black Bronze is best at resisting Piercing and regular Bronze does moderately well with any damage.
For Colored Steel, Blue Steel is better at resisting Crushing damage, whereas Red Steel is better at resisting Piercing damage.