Fungible is a positive quality where two or more of the same thing have identical value. That is to say, one of a group of things can be a substitute for another and it won’t change the value.
For example, your $20 bill is worth the same to you as any other $20 bill. On the other hand, my car doesn’t have the same value as your car and so it is not easy substitute and is non-fungible.
Some cryptocurrencies like bitcoin don’t have fungible coins. That can be a problem when these coins are used for illegal transactions, because with enough research, some of the coins can be linked to that illegal activity. Coins with that bad mark are not desirable and so they are non-fungible.