The MPLAB XC8 compiler is a C cross compiler for the PICmicro microcontroller processor. It is called a cross compiler, not because it is unhappy (ho ho) but because it does not produce output for the machine it actually runs on. You run the compiler on your PC and it produces code for the PICmicro microcontroller.

MPLAB XC8 acts on a text file containing the C program itself (the source file) and produces an assembler file which it then assembles to Hex code that the PICmicro microcontroller can run. You can look at the assembler file if you wish, and XC8 will embed the C you have written as comments in the assembler source.

XC8 is a part of the MPLAB X IDE (Intergrated Development Environment). MPLAB X IDE provides the editing environment and manages projects containing a number of different source files, and sends them to the MPLAB XC8 compiler where you compile your program.

MPLAB X IDE is the part of the program that you will see and use, so we will normally refer to MPLAB X IDE rather than the MPLAB XC8 compiler.