The towel is hanging on the rack.

Meaning: This sentence also means that the towel is not on the floor or in a pile, but instead is hanging on a rack.

Choice of Words: The is used to specify a particular towel. Is is a verb that indicates the state or condition of the towel. Hanging is a verb that means to be suspended from something or to be attached to something. Rack is a frame or stand designed to hold items, often used for hanging towels. When you put them together, "The towel is hanging on the rack" describes the position of the towel, which is hanging on a rack.