A species is a group of organisms that can interbreed and produce healthy offspring which can themselves breed. Wolves and dogs can produce fertile puppies, so they are both the same species (Canis lupus), but mules are usually sterile so horses and donkeys are different species. Asexual species, such as hydras, are defined by their body shape, as are many fossil species, which - being dead - obviously can't breed with anything any more.
In biological classification, rank is the level in a taxonomic hierarchy. Examples of taxonomic ranks are species, genus, family, and class. Each rank subsumes under it a number of less general categories. The rank of species, and specification of the genus to which the species belongs is basic, which means that it may not be necessary to specify ranks other than these.