In Ruby, strings are mutable, meaning you can change their content after creating them. When you create a string like "hello", it is stored as an object in memory. If you modify the first character to "H", the string content changes to "Hello" but the object itself remains the same, keeping its object ID. This is different from immutable strings where a new object would be created on modification. The execution table shows the string content and object ID at each step, confirming the string is changed in place. This mutability makes string operations efficient in Ruby.