ISO stands for International Standards Organization and is used in reference the industry standard for the sensitivity of the light aperture in a digital camera. This term was first used in standard non-digital cameras for the same thing, except it applied to the film, not the camera.
In the case of ISO, unlike some other measurements, the lower the number the finer and more crisp your shot is going to be. A higher number ISO will cause the shot to come out less clear and more grainy. There are times that someone might want the higher numbers, however, such as if a subject is moving or not as well lit as it should be.