Well createElement allows you to create an element and add it to the flow of the page. So for eg:
var newDiv = document.createElement("div");
document.body.appendChild(newDiv);
Creates a div object called newDiv and appends it to the body element; you can equally append it to something else:
document.getElementById("some_thing").appendChild(newDiv);
Once it's there, you can manipulate it and add code to it. There are two core ways - setAttribute and innerHTML - innerHTML is not actually in the standards I don't think, it's an IE extension which others have adopted; setAttribute is in the standards but is not well supported in IE.
Anyway here's something you can get started with - this works in IE5/6, mozilla, opera 7, konqueror/safari:
<html><head></head><body>
<script>
function createIt() {
var newDiv = document.createElement("div");
document.body.appendChild(newDiv);
newDiv.setAttribute("style");
newDiv.style.position = "absolute";
newDiv.style.left = "20em";
newDiv.style.top = "10em";
newDiv.style.backgroundColor = "yellow";
newDiv.innerHTML = "<b>Hello World</b>";
}
</script>
<a href="javascript:createIt()">createIt</a>
</body></html>