Excel 365 refers to the subscription version of Excel as opposed to a fixed version of like Excel 2019, Excel 2016, Excel 2013, etc.

Typically, the subscription version of Excel is available as part of a suite of applications called "Office 365", which was renamed "Microsoft 365" in 2020. You can see subscription status by navigating to File > Account, which shows current product information. The subscription version of  Excel is still downloaded and launched like a normal application on Windows and Mac OS.

The key thing to understand is that Excel 365 has new features that are not yet available in any other version of Excel. A good example is Dynamic Array Formulas, which include new functions like FILTER, UNIQUE, SORT, SORTBY, SEQUENCE, RANDARRAY, XMATCH, and XLOOKUP.

Note: Excel 365 should not be confused with "Excel Online" or "Office Online". These are limited feature applications that run in a browser.