What does 65536 Mean in the Computer?
65536 is the total number of unique values we can store in 16 bits. 16 bits equals 2 bytes.
Many things in computers jump from storing data in 8 bits to storing data in 16 bits, because they change from 1 byte to 2 bytes. Consequently, what previously used to be 256 (or from 0 to 255) becomes 65536 (or from 0 to 65535).
Examples
Integers
A 16 bit unsigned integer can store a number from 0 to 65535.
A 16 bit signed integer can store a number from -32768 to 32767.