The term "SEO" is the abbreviation to "Search Engine Optimization". This is not about optimizing search engines, though. It is about optimizing websites for search engines. But why one needs to optimize a website? To answer this question we need to understand what a search engine is.
Search engines as the way to find an info on the web appeared in the middle of 90's. They crawled websites and indexed them in their own databases marking them as having one or another keyword in its content. Thus, when someone put some query in the searchbox of that search engine, it quickly searched its database and found which indexed pages corresponded to that query.
So, the more keywords of a query a website had, the higher it was shown in the results of a search. We don't know who was the first guy realized that he can make some changes to the pages of his website to make it rank higher, but he was truly a diamond!
So, SEO is something that helps your site rank better in search engines.
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