Summary
Hold Back to block all high, mid, and Jumping Attacks, as well as Overheads. Hold Defensive Crouch to Block mid and low attacks.
Don't Get Hit
Blocking is your main means to defense. Although it sounds completely obvious, learning how to Block is one of the most fundamental skills in Fighting Games, and it'll never be more important than in Marvel Vs. Capcom 3. With the amount of angles you can be attacked from, Blocking is truly a skill in and of itself.
Blocking will obviously allow you to avoid taking the damage from your opponent's attacks. Once you Block an attack, you are rendered "stuck" in Block Stun and will freeze in place for half a second and then start sliding back a fixed distance, depending on the strength of the move you blocked. If you are in the corner, then the opponent will be pushed away from you as opposed to you sliding back. But that only happens if the opponent is on the ground. If they are in the air, they will not be pushed away from you while you are blocking.
Block Stun
If another attack connects on your character before you end your Block Stun, you will again be put into Block Stun and forced to Block again. In fact, when a second move connects while you are in Block Stun, you can even let go of the controller altogether and still block the next attack. So for example, if Iron Man performs his Unibeam, once you Block the first hit of it, you can let go of the controller because you will automatically block every other hit from the beam.
This is what is known as a Block String and also known as Absolute Guard. It's a sequence of attacks that, once you Block the first hit, you are trapped in Block Stun for the entirety of the sequence. It's basically a "combo" against someone who is blocking.
However, if you are blocking in the wrong direction, even during a Block String, you will still be hit. So, let's say the enemy does a Jumping Hard Attack from Spider Man and you high Block it. If he lands and does a Crouching Light Attack, which hits low, while you are still in your Block Stun and you don't switch to crouching, you will get hit. You still have to adjust high or low for blocking, even during Block Stun.
Strategy Corner
BLOCKING FROM FOUR ANGLES
Proximity Blocking
Marvel Vs. Capcom 3 also has Proximity Blocking. Your character will only block if the enemy's attack actually touches you. Otherwise, you character will never get stuck in block animation if the opponent's attack whiffs, no matter how close it is to hitting you.