A static template is a project you can only use as a template. It is not a real “live” project. Its tasks do not appear in user task lists and they do not generate any e-mail notifications. Time cannot be recorded on a static template.
On the other hand, a dynamic template is a project you can use as a template but it is also a real “live” project. Its tasks are displayed in task lists and they do generate e-mail notifications. Time can be recorded on a dynamic template.