Yaoi is love between two guys in anime. Many people think it's just gay porn but its not, though there are some yaois that have more explicit content, but people call them 'Hard Yaoi'. Yaoi has more of a story line than Hard Yaoi and the sex scenes in Yaoi aren't as long and you don't actually see them do it. Yaoi is really about relationships between gay people, not them 'getting it on' -_-
Also most people who watch Yaoi are girls who find gay relationships cute, they are called 'Yaoi Fangirls'. However i have heard of straight guys watching Yaoi too.
A good example of a Yaoi is Junjou Romantica.
A good example of Hard Yaoi is Sensitive Phonograph. (yes, its exactly what it sounds like and it the most explicit yaoi i've ever seen)