VoIP is just a fancy acronym. The letters in VoIP stand for Voice-over-Internet Protocol.
In a nutshell, VoIP allows you to make phone calls over the Internet. You still use a telephone the same as before, but instead of plugging your phone into the socket on your wall, you plug it into your computer network.
This allows for much cheaper call rates with the same or better service by utilizing the latest available technologies.
Having VoIP also allows for other fancy things such as a PBX:
See this article: http://support.neural.com.au/entries/20822736-what-is-a-pbx
Want to learn more?
Wikipedia has a comprehensive article on VoIP, which can be found at: