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Why do they matter?
Design is about making decisions with purpose and organizing or placing elements in the most appropriate manner in order to communicate a message. These actions require a thorough knowledge of the elements and principles of design and a well-planned procedure.
Try to fix a car or put together a barbecue without knowing what a car or barbecue is used for. Take a trip to the downtown area of a large, unfamiliar city in Poland without a map to find a shop that sells fresh blintzes.
You can quickly see how important knowledge and research are if you are trying to find a solution to a problem and develop a plan to get it done.
Breaking them down
The elements of design are what are used to create a composition (lines, shapes, value, etc.), while the principles of design are how the elements are used. Because the principles of design are based on psychological studies of people’s perceptions of visual elements, they provide us with a basic framework for applying the elements of design in order to achieve a desired mood or effect.
These psychological studies – i.e. understandings of how the eye and mind work together to perceive and organize visual information – have been linked to the Gestalt Theory, which infers two fundamental concepts:

• People inherently look for order or a relationship between various elements
• People perceive individual parts of an image as separate components, which are readily grouped as part of a larger whole

Designers use the way people naturally organize images in their heads in order to emphasize particular aspects of a composition. A successful design is one that uses the principles of design to arrange the elements of design in a way that creates a desired effect based on the Gestalt Theory.
The core principles of design include unity/harmony, variety, focal point/visual hierarchy, and balance. Unity can be achieved via placement using repetition of line or shape, rhythm, value, or continuity while variety can be created with contrasting lines and shapes based on visual weight, size, and type. Repetition, rhythm, continuity, variety, scale, proximity, and contrast, therefore, can be considered principles of design as well.
There is a significant amount of overlapping of principles and applications of techniques that can be used to create a desired effect, and the principles of design really can be found in the organization and design of almost anything.