Magic is a special type of power usable by a set few who learn how to utilize it, though a few beings have been shown to utilize it naturally. Characters like Bibidi and Babidi are natural born masters of magic.
Overview
Magic is primarily used for supportive techniques, such as possession, and there are not as many offensive techniques that are used magically. Magic is completely distinct from ki, and so while a magic user may possess low ki power, they could easily possess immense magic abilities - as the two energies are not related to each other.
Babidi's mind control technique
For example, the wizard Babidi possessed very little strength; however, he had enough magic power to take control of even the likes of Demon King Dabura, or create a magic shield that could protect him from Buu's Angry Explosion.
Various races such as Namekians, Majins, Demons, Shin-jin, and other deities are shown to be adept at using magic and/or magic abilities. Also certain Humans such as Fortuneteller Baba (who is a witch) are shown to be capable of using magic, though it is unclear if it is a learned skill (like Ki manipulation) or innate ability.
In the case of Namekians, members of the Dragon Clan appear to be more inclined towards the use of magic than Warrior-type Namekians, however it is still possible for Warrior-type Namekians to use magic, as demonstrated by Piccolo.
Usage
Buu's Chocolate Beam is a prime example of combining ki and magic
Magic first appeared through the Magic Materialization technique, an ability that allowed the user to summon an object as if from thin air. While not as common as ki attacks or physical blows, several magic techniques would go on to appear throughout the series, including Magic Touch, Sealing Spell, Demon Eye, magic Teleportation, and mind control.
Additionally, magic imbued items are shown to exist - such as the Power Pole.
It is shown that magic and ki can be mixed together by skilled users of both - as displayed by the Chocolate Beam technique utilized by Buu.