Magnetic dipole consists of two equal and opposite magnetic poles separated by a small distance.

When it is placed in an external magnetic field, it experiences a torque and dipole sets itself in a particular direction.

Example: A compass needle, a bar magnet, a current carrying loop. An atom of a magnetic material also behaves as a dipole due to electrons revolving around the nucleus.

Reference: This article is referred from my authored book”electrical engineering materials.