What is a sacrament?
In the western tradition (Roman Catholicism), sacrament means a holy action (from the Latin, Sanctus, which means holy). And the R.C. Church identified seven of them, while the early Protestants had only two, and most contemporary Protestant Evangelicals don't have any. However, the eastern church never used the word sacrament or it's Greek equivalent. In fact, when Latin and other western languages translate mysterion as sacrament, they are really changing the meaning of the word. From an eastern Christian perspective, all things and actions (good actions) are potentially holy.
The church actions that in the west are called sacraments (communion, baptism, marriage, etc.) are called mysteries in the Orthodox Church. They are called mysteries, not because we do not know what is going on, but because they manifest in time and space the reality of heaven, which is not easily knowable without years of spiritual growth. But through the mysteries (sacraments) we can participate in spiritual realities in a way that is accessible to the senses and the rational mind to the end that we are trained to be sensitive on a deeper, spiritual level to the spiritual realities that are always present. Well, that's not the only end, but that is one of the ends. God does not force us first to learn how to hear and behave spiritually before he comes to us. God has given us the mysteries in the church so that anyone at any stage of spiritual development (or sinful degradation for that matter) can begin to know and access a genuine relationship with God through the mysteries in the Church.
In the west, the idea developed that through the sacraments special grace is given. The Orthodox Church would not necessarily disagree, but would generally not focus on that. In fact, the Orthodox perspective is more along the lines that God gives Grace--special and otherwise--through all sorts of actions if one would only be aware of it. The mysteries, on the other hand, are ways in the Church to participate in (and of course receive Grace from) heavenly realities. In baptism, we are baptized into Christ's death and resurrection--we participate in Christ's baptism. In the Divine Liturgy, we ascend with Christ into heaven and mystically eat His body and drink His blood. In marriage, we manifest the union of the heavenly bridegroom with His Church.
These are mysterious realities because they cannot be directly known by the senses or the rational mind. But through the liturgical life of the Church, these spiritual realities can be known and experienced and participated in. We participate in a way that even the spiritually weakest can appreciate. The youngest child or the mentally challenged person or the morally weak person, or the holiest monk all eat the same bread and wine that has mystically become the Body and Blood of Christ. Each participates, each receives all of Christ, yet what each knows and experiences and how each is spiritually nourished depends on where each is in his or her journey towards the Likeness of Christ.