Ok maybe someone who actually plays should answer, but here's my attempt.
If you have a GPS toy ..er .. tool, you obviously have the ability to know what geographical coordinates you may be standing at, at any time you want.
So geocachers have some fun with this, I guess they'll have coordinates posted somewhere, and if you're ever near such a spot, you have to look for a secret "cache." Maybe it's just a guest book that you sign, maybe it's something else. Maybe you're supposed to leave something of your own for the next person to find. This is kinda muddy to me.
But it basically involves finding "secret" locations.
It kinda sounds fun, if I ever pick up a GPS toy ..er .. tool .. It's something I could see myself playing around with.
Here's the wikipedia page, maybe with a better description (I'm only just reading it right now myself):
http://en.wikipedia.org/wiki/Geocaching