This is the pound sign. It came about from old english measurements, though the weight pound is now abbreviated lb instead of #. Most phones have a key with this character, and along with 10 numerals and the asterisk (* or 'star') it makes up the standard 12 key phone keypad, devloped by AT&T for their new touch-tone keypad. Touch Tones, incidently, support 16 keys, the other four are labelled A, B, C and D, and are not normally used.

It, #, is also used in musical notation to idicate that a note should be sharp. The musical scale includes 12 notes. Some combinations of notes are not in harmony with each other, so typically you use only 7 of the twelve in a given piece of music. To keep things simple, they only named 7 notes (ABCDEFG), and placed the other five inbetween the seven. The # sign is used to show that the note above the current note is to be used, so an F# would actually use one of the 'extra' five notes that lies between F and G. A flat is the opposite (ie, a G flat is the same as an F sharp)

In American english it is most often pronounced 'Pound' in relation to phone and keyboard buttons, and sharp in relation to music..