So you've heard about Ubuntu, and you'd like to know more? You've come to the right place. If you're looking for a tutorial, or a getting started guide, I would suggest refining your search, as there are plenty of places with that kind of information. This bit is only going to try to answer the question, "What is Ubuntu?".
First, a bit of background.
Unix is an operating system that was developed in the late 1960's and early 1970's at Bell labs. You can read about the history of Unix at Wikipedia's Unix page. Unix now has various "branches", some of which are still Unix, and some which are very Unix-like. The latter are often referred to as Unixes, Unices, or *nix.
One of those latter systems is called Minix. It is an operating system designed to be used by university students who are studying the implementation of operating systems. Back in the late 80's and early 90's, there was a student at the University of Helsinki by the name of Linus Torvalds. He was learning about Minix, and desired to have something like it on his home computer, but because Minix was distributed under a restricted license (and cost $$), he couldn't use that. He then began coding what is now known as the Linux kernel. He then posted a message on a newsgroup about his new project, and found lots of volunteers.
Around the same time, at the University of Berkely, there was a man by the name of Richard Stallman. He was creating a suite of utilities (GNU) for a free Unix system, but had no kernel. The two projects ended up joining forces, and are now known collectively as Linux, although some people will insist on using the more accurate Gnu/Linux.
Gnu/Linux (hereafter known as Linux), and standard bundled software is known as a "distribution". Due to permissive licensing, anybody is allowed to use, modify, and re-release this software as long as the specific rules are followed. Check out a comparison of different licenses. This has allowed for an ecosystem of distributions, with each having different strategies and tactics.
One of the most popular (and oldest) Linux distributions is called Debian. It was named as a combination of the names of its creator, "Ian Murdock", and his then girlfriend, "Debra Lynn". From Debian there have been many other distributions which got their start from this elder system: Ubuntu, Mint, DSL, Knoppix, Linspire, and others.
Ubuntu was started in 2004 by .com rich-guy and awesome world-class philanthropist Mark Shuttleworth. It follows a fairly strict regimen of "release early and release often", with time between each release at 6 months. Each release is given a number, and comprises the year and month of release. The latest release (as of September, 2012) was released in April, and is 12.04. The next release should be out shortly, and is 12.10. Ubuntu has received a lot of attention since early on, and so is now believed to be the most common distribution for desktop use. As there is no single company that controls Linux, and frequently no cost associated with acquiring it, it is next to impossible to estimate how many machines it is running on.
Ubuntu releases are also given alliterative animal names. The latest (12.04) is Precise Pangolin, and you can find a list of the other release names on the Ubuntu site.
The history of Ubuntu, and Linux in general, is a long one, and so there is too much to mention in a single article. If there is something important that you think I should add, please let me know in the comments!