Corona makes it very easy to add physics to your games, even if you've never worked with a physics engine before. While the underlying engine is built around the well-known Box2D, we've taken a radically different design approach that eliminates most of the coding that is traditionally required.
Say you want your game to have a bouncing ball, Corona's Physics engine makes this easy. In just a few lines of code you can have a ball bouncing around the screen!
You can also use Physics for action collisions. Say you want to have your player walk into a certain area on the screen and have an action take place, you can easily do this by using Corona's Physics engine and using a sensor Physics body.
For more information see the Corona Physics guide.
Also, please see Solutions to Common Physics Challenges to help you avoid common roadblocks.