The head gasket sits between the engine block and cylinder head. Why does it 'go' ? Well normally due to age and/or high mileage. When it goes the engine coolant gets into the cylinders and the symtoms are loss of power (due to loss of pressure in the engine) and clouds of white smoke out of the exhaust. I understand this is more common on 4 cylinder engines than larger configurations. I'm not a mechanic so you may get more detailed answers, it's just that I've had a couple go in my time.