Derogatory (and somewhat juvenile) term used to refer to the now-defunct TSR Inc. While TSR used to be an extremely popular publisher, they charged rather high prices for their products, and published a lot of (very varying quality, but at many times disappointingly low) books about everything related to their games, so people rightly suspected their motive was not quite "art for art's sake".
The new owner of TSR inc. is Wizards of the Coast. When announcing the new stuff that the third edition of Dungeons and Dragons would have, they made an interesting mistake - the press release misspelled their name as "Wizards of the Cost" at one point. Well, what can you expect from the makers of cardboard crack... =)
It must be noted, however, that WotC runs the shop better than TSR did. They even released old out-of-print stuff on their web site, free of charge.
Other speculations on what abbreviation TSR might mean (common running jokes in RPG community - collected in Murphy's Rules book by Steve Jackson Games):
Table Left Unnamed At Insistence Of Our Attorneys
- Terribly Silly Rules
- Trademark Symbol Required
- They Sue Regularly
- Their Subscriptions Revoked
- Tough S***, Readers
- Total Staff Resignation
(See also: TSR Copyright Debate)