The button indicates the player that has position over all other players, except for the pre-flop street. It moves clockwise after each hand.
Also called the "Dealer Button".
Many forms of poker such as Draw poker and Hold'em poker (Texas Hold'em and Omaha) involve a rotating deal. The deck is passed clockwise each hand to a player. The player then is the dealer for that hand. The dealer has position over all other players, except for the pre-flop street. It's usually symbolized by a big chip with a "D" on it.
The button has no use in Stud games, since other rules are applied in those games to determine who acts next.