Term probably popularized by Philip Greenspun.

It is a particular type of website anyone can inexpensively build using:

• A relational database (PostgreSQL)..
• A webserver (Apache with mod_perl and PHP is one, AOLserver is another)..
• And an inexpensive PC (one managed by an inexpensive but network savvy operating system such as Linux or FreeBSD).

All it cost is your time and effort (which is not free), an inexpensive but durable PC, and Free Software.

To make everything work together you'll have to fulfill a few responsibilities:

• Begin by learning basic system administration..
• Learn how to access and modify relational databases using a scripting language (Perl, PHP, Python, Javascript, Tcl are the popular ones--pick one--they are all simple to learn)..
• And learn to rely on the readily available and searchable documentations. (you can do this by asking people where to start reading; and bookmark gems of online information you come across; doing this and keeping up with the latest news on the net will help you understand and resolve any odd problems that may come up)

To kick off your learning experience (so you too can run a database-backed website like the big boys) try Philip Greenspun's book: Philip and Alex's Guide to Web Publishing.