What does immutable mean?

On a lower level, immutability means that the memory the string is stored in will not be modified. Once you create a string "foo", some memory is allocated to store the value "foo". This memory will not be altered. If you modify the string with, say, substr(1), a new string is created and a different part of memory is allocated which will store "oo". Now you have two strings in memory, "foo" and "oo". Even if you're not going to use "foo" anymore, it'll stick around until it's garbage collected.

One reason why string operations are comparatively expensive.

I'm not certain about JavaScript, but in Java, strings take an additional step to immutability, with the "String Constant Pool". Strings can be constructed with string literals ("foo") or with a String class constructor. Strings constructed with string literals are a part of the String Constant Pool, and the same string literal will always be the same memory address from the pool.

Example:

    String lit1 = "foo";
    String lit2 = "foo";
    String cons = new String("foo");

    System.out.println(lit1 == lit2);      // true
    System.out.println(lit1 == cons);      // false

    System.out.println(lit1.equals(cons)); // true

In the above, both lit1 and lit2 are constructed using the same string literal, so they're pointing at the same memory address; lit1 == lit2 results in true, because they are exactly the same object.

However, cons is constructed using the class constructor. Although the parameter is the same string constant, the constructor allocates new memory for cons, meaning cons is not the same object as lit1 and lit2, despite containing the same data.

Of course, since the three strings all contain the same character data, using the equals method will return true.

(Both types of string construction are immutable, of course)

Immutable means that which cannot be changed or modified.

So when you assign a value to a string, this value is created from scratch as opposed to being replaced. So everytime a new value is assigned to the same string, a copy is created. So in reality, you are never changing the original value.

It means that once you instantiate the object, you can't change its properties. In your first alert you aren't changing foo. You're creating a new string. This is why in your second alert it will show "foo" instead of oo.

Does it mean, when calling methods on a string, it will return the modified string, but it won't change the initial string?

Yes. Nothing can change the string once it is created. Now this doesn't mean that you can't assign a new string object to the str variable. You just can't change the current object that str references.

If the string was mutable, does that mean the 2nd alert() would return oo as well?

Technically, no, because the substring method returns a new string. Making an object mutable, wouldn't change the method. Making it mutable means that technically, you could make it so that substring would change the original string instead of creating a new one.