Stands for "Linux, Apache, MySQL, and PHP." Together, these software technologies can be used to create a fully-functional web server.
Linux is the most popular operating system used in web servers, primarily because many free Linux distributions are available. This means Linux-based servers are typically cheaper to set up and maintain than Windows servers. Since Linux is (open source|open source), it also works with many other popular open source web hosting software components.
The most important software component in the "AMP" package is Apache, or "Apache HTTP Server." Apache is the software that serves webpages over the Internet via the HTTP protocol. Once Apache is installed, a standard Linux machine is transformed into a web server that can host live websites.
Other components of LAMP include MySQL and PHP. MySQL is a popular open source database management system (DBMS) and PHP is a popular web scripting language. Together, these two technologies are used to create dynamic websites. Instead of only serving static HTML pages, a LAMP server can generate dynamic webpages that run PHP code and load data from a MySQL database.
NOTE: In some instances, the "P" in LAMP may stand for either Perl or Python, which are other scripting languages. "AMP" packages for Windows and Mac systems are called WAMP and MAMP respectively.