Oil seals do the same job as normal gaskets. They prevent fluid or gas from leaking from one place to another. The big difference with an oil seal is that it is mounted on a rotating part, usually a shaft. An oil seal has a sort of chamber around the shaft on which it is mounted. Fluid can collect in this chamber, which provides lubrication and prevents the seal from wearing out. A very thin spring then holds the oil seal tightly against the shaft.
Common gaskets that leak in cars are; rocker cover gaskets, head gaskets, coolant flange gaskets and exhaust gaskets. However, especially with older cars, you sometimes see "sweating" parts that are greasy or wet. This is usually because the old gaskets or oil seals harden over time and therefore seal less effectively.
How do you prevent leaking gaskets or oil-rings?
Change your oil on time. Your oil contains additives that prevent your oil seals or gaskets from drying out. Old oil causes gaskets to dry out faster. If you have replaced parts that have a gasket between them, always replace the gasket. Most gaskets should not be fitted more than once and will not seal properly afterwards. This is not worth saving money on, because there is a good chance that you will have to disassemble everything again after a short time because the gasket has started to leak.