A glossary is a list of terms that need defining. In just about every book there will be terms that the average reader doesn't know and understand. This example is from my medieval novels. There are terms that relate to the parts of swords, the clothing, and other aspects of medieval life that might not be commonplace for the average reader. I use the glossary to define those terms for them.
Even in my modern murder mystery novels, I include a glossary. It helps to provide more details about the locations and events described in the book.
Non-fiction books can use glossaries as well. In a cooking book, terms for certain types of cooking techniques can be explained here. By having it in the glossary, a user can quickly find the information no matter where the term is used in the book.
A glossary should have a heading just like other chapters and sections do. It should be included in the table of contents.
In terms of page numbers, the glossary lives in the "back matter" section. It can either have consistent page numbers with the main body of the text, or it can start with roman numerals. Because you generally do want this to be in the table of contents, it should have some sort of a page number.
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