Entity is an ID. You can think of it as a super lightweight GameObject that does not even have a name by default.
You can add and remove components from entities at runtime. Entity ID's are stable. They are the only stable way to store a reference to another component or Entity.
You can add and remove components from entities at runtime in much the same way as a GameObject. Entities can be created from Prefabs by using ComponentDataWrapper. The EntityManager will parse the Prefab for ComponentData and add it when it creates the Entity.
Iterating over all entities that have a matching set of components, is at the center of the ECS architecture.