Does a creature with indestructible still take damage, just not die from it?

Indestructible is a static ability defined in CR 702.12. It means the permanent cannot be destroyed — specifically, it is not destroyed by lethal damage and is unaffected by effects that say 'destroy.' It does not mean damage is prevented or ignored.

Damage still fully applies to an indestructible creature (CR 120.1, 120.3). This matters for several reasons: damage marked on a creature is tracked normally, abilities that trigger on damage (like lifelink or deathtouch) still function, and damage from a source with deathtouch would normally kill any creature — but indestructible stops even that destruction (CR 702.2b).

However, indestructible does not protect against all ways a creature can leave the battlefield. Effects that reduce toughness to 0 or less (causing the creature to die via state-based actions for having 0 or less toughness, not for lethal damage), or effects that exile or sacrifice the creature, still work normally (CR 704.5f vs 704.5g).

Concrete example: Your opponent attacks with a 5/5 indestructible Darksteel Colossus. You block with a 3/3. The Colossus deals 5 damage to your 3/3 (which dies to lethal damage), and your 3/3 deals 3 damage to the Colossus. The Colossus has 3 damage marked on it but survives — it is not destroyed because of its indestructible ability (CR 702.12b).

Summary: damage is real and tracked on indestructible creatures; indestructible only stops the destruction that would normally result from lethal damage, not the damage itself.