White space, also called "negative space", is any empty, unused space on a page that isn't filled with content: words, images, user interface elements, buttons, etc. It is the gaps between lines of text, spacing between paragraphs, empty space around photos, and margins at the sides. It doesn't have to be literally white - it can have any background colour or pattern.
White space is just as important as the content itself. Think about how hard it will be to read a page if all the words and pictures are crammed closely together without any gaps. Designs need white space to "breathe" and designers can manipulate white space to interesting effects.
One of the best examples of clever use of white space is the Google homepage. Unlike other websites which are usually loud and filled with information, Google chose to remove all unnecessary elements. This brings the focus onto the middle of the page, the Google logo and the search bar itself. The purpose of the page is to make you search and it does it very well.