Electron shells are regions around an atom's nucleus where electrons are likely to be found. These shells are organized in layers, with each layer corresponding to a specific energy level. The first shell can hold up to 2 electrons, the second can hold up to 8, and the third can hold up to 18, following the Aufbau principle. Electrons in the outermost shell, known as the valence shell, play a crucial role in chemical bonding and reactions. The arrangement of electrons in these shells determines an atom's reactivity and the types of bonds it can form with other atoms, influencing the behavior of elements in various compounds.