An Acronym for Session Initiation Protocol
A protocol for establishing a media session between two end-points. It doesn't carry the actual media, but can detect NAT, etc.
One of the major uses of SIP is to assign a user a well-known name, sort of like an email address, that they can use no matter where they connect from.
Some SIP services include:
Redirection: basically a way for a user on a dynamic IP address to be assigned a well-known name. You can register an account with a remote SIP server and when you are online, this server will tell incoming calls your real IP address. It also means you can take your hardware VoIP phone with you and plug it in anywhere (assuming you get assigned a routable IP address).