The Five Elements are abstract entities represented in nature by Metal, Water, Wood, Fire and Earth and are used to classify all known phenomena by how closely their properties match those of these Five Elements. Having classified things by their properties, the Theory is then used to explain and chart their relationships and mutual interaction.

The Five Elements and their cycles of balance and imbalance are the basis for much of Chinese culture. It was employed as a device in many fields of early Chinese thought, including seemingly disparate fields such as geomancy or Feng shui, astrology, traditional Chinese medicine, music, military strategy and martial arts.

These five phases describe a creation (sheng) cycle and an destruction (ke) cycle of interactions between the phases. These cycles are sometimes called "mutual production (xiang sheng)" and "mutual conquest" (xiang ke).
        These are the Cycles of Balance.

In the generating or creation cycle:

• METAL collects WATER
   
• WATER nourishes WOOD
   
• WOOD feeds FIRE
   
• FIRE makes EARTH
   
• EARTH creates METAL
  

In the controlling or destructive cycle:

• METAL splits WOOD
   
• WOOD parts EARTH
   
• EARTH absorbs WATER
   
• WATER quenches FIRE
   
• FIRE melts METAL
  

If any of the elements are over abundant they will overact the acted-upon element (xiang cheng). Fire creates Earth, but too much Fire will melt the Earth.
        Sometimes the acted-upon element is too strong, or the acting element too weak and the 'natural' order is temporarily reversed. Like if a fire is too fierce or there is not enough water, the fire vaporizes the water. If the river swells, it may burst its banks or destroy the dam which bars its way, etc. This we call it insulting (xiang wu). Following are the Cycles of Imbalance:

In the overacting cycle which follows the creation cycle:

• Too much METAL overacts WATER
   
• Too much WATER overacts WOOD
   
• Too much WOOD overacts FIRE
   
• Too much FIRE overacts EARTH
   
• Too much EARTH overacts METAL
   
  In the insulting cycle which is the reverse destructive cycle:

• Too much METAL insults FIRE
   
• Too much WOOD insults METAL
   
• Too much EARTH insults WOOD
   
• Too much WATER insults EARTH
   
• Too much FIRE insults WATER
  

According to Wu Xing theory, the structure of the cosmos mirrors the five elements. Each "element" has a complex series of associations with different aspects of nature, as can be seen in the following table. There are numerous items in this huge system, ones listed below are of the most presentative and still common to Chinese people today.

References:
http://www.golem.demon.co.uk/article-t5e.html
http://en.wikipedia.org/wiki/Five_elements_%28Chinese_philosophy%29
http://www.northernshaolinacademy.com/new/NsaQigongMeditationFiveElements.asp

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