When you convert type to outlines in it creates a frame that can contain a picture or be used as a text frame that you can then fill with type.
Type within type is an interesting typographical effect that is very easy to create in InDesign. Before you start, think about which fonts you want to combine, and perhaps do a little experimentation. Also consider whether you intend the text inside to be readable - you could use it instead to create a typographical pattern.
When you turn type into outlines in InDesign the application automatically generates an inline graphic that still sits within the original text frame. For this effect it is easier to generate a copy of the type when you create the outlines - we explain how to do this in the tutorial.