Pagination in Dynamic Posts (old version) allows you to display all your fetched results in multiple pages instead of showing them all on one page.
You can choose:
to show the page numbers and how many;
to show the prev/next with an icon and a label;
to show the first/last number and the icon.
When you use the widget in the Taxonomy Terms archive and you need pagination,
the setting " Number of Posts" must be less or equal to the configured value "Blog pages show at most" in the main WordPress menu Settings > Reading.