A lacto-vegetarian is someone who does not eat meat or eggs, but will consume dairy products, according to About.com's Vegetarian Food expert. "Lacto" is the Latin word for milk. Many Hindus and Buddhists are lacto-vegetarian for religious purposes, according to SFGate.
Lacto-vegetarianism and veganism differ in that vegans will not consume dairy products, but lacto-vegetarians will, according to Wikipedia. SFGate points out that lacto-vegetarians exclude eggs as they are undeveloped chicken embryos and therefore considered an animal product. Cheese made from rennet and yogurts made with gelatin are also not included in the diet, as rennet and gelatin are animal products.