A dwarf star is a term used, oddly enough, to describe any star that is of normal size for its mass. Such stars lie on the main sequence, and are thus in the process of converting hydrogen to helium by nuclear fusion in their cores. The Sun, for example, is classified as a yellow dwarf.
There are, however, other types of dwarf star. These include white dwarfs, which are collapsed stars that are still hot and shining, black dwarfs, which are cold, dead stars, and brown dwarfs, which are not massive enough to be able to fuse hydrogen in their cores.