Stock footage is pre-existing footage that is spliced into a film when a general scene or event is needed. Stock footage is often short and is of something very general like a car exploding or people walking. A good example of use of stock footage is when Monty Python would cut to a shot of people clapping, which looked like it was from the 1950s. Many times stock footage is put in for comedic effect, or just because the movie is really bad (take TROMA movies, for instance).
Some stock footage is not just for comedy or suck factor, there can be stock footage for scientific use (such as an amoeba floating around..etc.). Stock footage is free from some places, depending on how old it is and the quality. Other places make you pay to use it. Most of it isn't under any kind of copyright, but sources should be listed in the credits of whatever they are used for.