A chat is one thread of back-and-forth with ChatGPT. Everything in it, your messages, files, and its replies, sits in that chat's context window. Start a new chat and that desk is clear again.
ChatGPT adds two layers on top. Memory can carry details about you from chat to chat, and a project can give a group of chats the same files and instructions. In the desktop app, Chat is also the name of the quick back-and-forth mode, next to Work.