Edge loop
Loosely speaking an edge loop is a set of connected edges across a surface. Usually the last edge meets again with the first edge, thus forming a loop. The set or string of edges can for example be the outer edges of a flat surface or the edges surrounding a 'hole' in a surface.
In a stricter sense an edge loop is defined as set of edges where the loop follows the middle edge in every 'four way junction'. The loop will end when it encounters another type of junction (three or five way for example). Take an edge on a mesh surface for example, say at one end of the edge it connects with three other edges, making a four way junction. If you follow the middle 'road' each time you would either end up with a completed loop or the edge loop would end at another type of junction.
Edge loops are especially practical in organic models which need to be animated. Take a model of a face for example. If the edge loops follow the contours of where the muscles would be then the face will deform much more smoothly compared to when the edges would be place arbitrarily.
"From wiki.cgsociety.org"
External links
http://wiki.cgsociety.org/index.php/Edge_Loop