Linux is a computer operating system, like Unix, Windows 95/NT, MacOS, and OS/2. It was originally developed for Intel x86 processors, but now runs on Motorola 68k, Digital Alpha, Sun Sparc, MIPS and Motorola PowerPC machines. Linux is source compatible with Unix (this means that programs which are written for Unix can be recompiled with no changes to run under Linux) and runs nearly all of the same software as commercial Unix versions, but it is not descended from the non-free Unix sources.
It supports a wide range of software, including graphical user interfaces, text editors, word processors, databases, web servers, and an extensive collection of networking software (including PPP and ISDN). Many people have run benchmarks on Pentium Linux systems and found them comparable with mid-range workstations from Sun and Digital.
Linux (often pronounced with a short "i" and with the first syllable stressed -- LIH-nucks) is available over the Internet from hundreds of ftp sites, and from various vendors on CD-ROM.
The Linux kernel is covered by the GNU Public License (GPL), and is usually bundled with various programs that comprise a working UNIX operating system. These software bundles are called "distributions" and come in many sizes and arrangements.
Linux is being used today by millions of people around the world. It is used for software development, networking (intra-office and Internet), and as an end-user platform. Linux has become a cost-effective alternative to expensive UNIX and Windows NT systems.
(Adapted from http://www.linuxresources.com/what.html).