An SLR is a Single Lens Reflex camera. The single lens part refers to the fact that it is using a single lens for capturing images and displaying on the viewfinder. The reflex part refers to the use of some mechanism for reflecting light towards the viewfinder.
An SLR is a preferred style of camera because it allows the photographer to see exactly what will be captured by the film or sensor without any parallax or distortion. For this reason, high end features have been incorporated into these cameras and the style of camera is sometimes confused with the high end features that go along with it.
Some common misconceptions about SLRs:
Many people believe that SLRs must have interchangeable lenses. In fact, there is nothing about the SLR concept that implies or requires interchangeable lenses. Film SLRs without interchangeable lenses have existed for many years. The Olympus IS Series is an example of such a design. Olympus has also made several digital SLRs with permanently attached lenses over the years, starting with the D-500L. Their most recent example is the E-20. It is also worth noting that the cousin of the SLR, the twin lens reflex (TLR) camera, usually comes with a permanently attached lens. High end rangefinder cameras such Leicas feature interchangeable lenses but are not SLRs.
Some people believe that an SLR must have a moving mirror. However, there is nothing about the SLR concept that requires a moving mirror. The Canon Pellix and subsequent high speed models from Canon, did away with a moving mirror and used a partially transparent/reflective pellicle mirror instead. The mirror was fixed and never moved. The Olympus E-10 and E-20 achieve a similar effect with a combination of prisms.
There is a widespread impression that SLR cameras take better pictures than non-SLR cameras. This is generally true because SLRs tend to be higher end products to which better lenses are usually attached, but there is nothing about the SLR concept that directly affects picture quality. High end rangefinder cameras with good lenses are capable of taking shots that rival those from the best SLRs. However, in the realm of digital photography, the sensors with the best image quality are typically used in digital SLRs with interchangeable lenses.