Collagen is a structural protein (in fact the main structural protein), in humans it accounts for 30% of total protein, and 75% of the dry weight of skin 1.
It is found in various connective tissues such as cartilage, tendons, bones, and ligaments.
Collagen helps form a network of cells called fibroblasts in the dermis (see graphic of skin structure, dermis = middle layer of skin). It also plays part in the restoring/replacing process of dead skin cells.
As we age we product less and less collagen 2. This reduction in collagen results in a structural weakening of the dermis, as this occurs wrinkles form. The effects of a decreasing collagen supply are not just skin deep – our connective tissues are largely made of collagen and these weaken as well. Among other things this means our bones become brittle, and our joint cartilage weakens.
Reference:
1 https://www.ncbi.nlm.nih.gov/pmc/articles/PMC2846778/
2 https://www.ncbi.nlm.nih.gov/pmc/articles/PMC1606623/