An Iaito is a practice sword used in the Japanese martial art, Iaido.
Being very closely related to a ShinKen (True-Sword) it has a proper Tsuka, Kosherea, Saya and Tsuba etc. The only real difference (Appart from quality in most cases.) is that an Iaito doesn't have a sharp blade. The blade is usually made from a zinc alloy to stop it corroding and generally is of the same weight as a ShinKen.
Remember that swords are not toys and they must be treated with respect and only within a dojo. There is no excuse for missusing a sword.
The Iaidoka withdrew his iaito during a Kata.