Aristotle begins by outlining various perspectives on what constitutes substance: natural substances like fire and water, mathematical objects, and the more abstract concepts of essence and substratum. He then proceeds to delve into the nature of sensible substances, arguing that they possess matter, which exists potentially, and form, which represents actuality. The excerpt highlights key concepts like the distinction between potential and actual existence, the role of differentiae in defining things, and the importance of understanding the causal relationships between matter, form, and the agent that brings about actualization.