What are set up and non set up Objects in Salesforce?

Non-Setup Objects:
Non-Setup objects are standard objects like Account or any custom object.
 
Setup Objects:
Setup Objects are used to interact with metadata for declarative development. Setup objects are Group1, GroupMember, QueueSObject, User, UserRole, UserTerritory, Territory, etc..
List of Setup objects can be found in the following link
 
Note: 
We cannot do DML operations on Setup and Non-Setup objects in the same transaction. We will hit the "MIXED_DML_OPERATION" exception.

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