Microcontrollers play a crucial role in electronics as they serve as compact controllers for embedded systems. They integrate a processor, memory, and input/output peripherals on a single chip, making them suitable for controlling devices in applications such as automotive systems, home appliances, and industrial automation. Microcontrollers execute specific tasks by running programmed instructions and interacting with sensors and actuators. Their versatility, low power consumption, and small size make them ideal for a wide array of electronic products.