An ancient method of creating special effects in movies, involving a meticulous process of filming a model against a green screen. Has been almost completely replaced by CGI.
Jurassic Park was almost filmed using stop motion, but ended up with CGI dinos when the producers realized that stop motion is one fugly way of doing special effects.
Stop motion anmation is a way of creating films. The character (a toy or clay model) has it's picture taken. It is then moved a tiny bit and has another picture taken. After about 15 frames (pictures) you have 1 seconds worth of film!
Some examples can be found @ (don't wan't to advertise, just giving you some help):
Wallace and Gromit
Pingu (I think is a stop motion)