Waterproof, or closed-cell, foam is a dense foam that is more resistant to water due to its rigid structure. Dry foam is also sometimes referred to as waterproof, though it is a different type of foam than closed-cell foam.
Foam is manufactured from either polyethylene or polyurethane, which are porous materials. The term "waterproof" is somewhat misleading, because something that is porous can not be completely waterproof. Water resistant is a much more accurate description. Closed-cell foam absorbs less water because of its density. In some cases, it is so dense that it more closely resembles a non-porous solid. Because this type of foam also allows less heat to pass through, it is a popular choice for insulation.
Dry foam is a type of foam with very large pores to allow water and other elements to pass through very quickly, which prevents them from being absorbed by the foam. This type of foam is typically used in the manufacturing of outdoor furniture or other soft surfaces that are frequently exposed to the elements. Because of their waterproof properties, both closed-cell and dry foam are also very resistant to common problems of water saturation in foam, such as mold and mildew.