As others have said: Ubuntu is a free operating system based on Linux. The project is sponsored by Canonical Ltd, which is owned by Mark Shuttleworth. Ubuntu means “humanity towards others”
As other Linux distributions, a typical installation includes not only the “operating system”, but also most of the software you will need (OpenOffice.org as office suite, Firefox as web browser, Rhythmbox as audio jukebox, Totem as video player, Pidgin for instant messaging, etc.). There is a huge and helpfull community behind its development, and you can find free support on their online forums or buy professional support.
Ubuntu it’s based on Debian, and it’s aimed primarily at everyday desktop use, and uses only free software. Every six months there is a new release; some releases are called “long term support”, which means that they’ll be supported for 3 years after their release (the LTS “server” editions are supported for five years).
There are many Ubuntu derivatives. Ubuntu itself uses GNOME as its desktop enviroment, Kubuntu uses KDE, Xubuntu uses XFCE; Edubuntu it’s aimed towards school enviroments, etc. All of these are “official subprojects”, but there are also many forks, such as Linux Mint, which also includes some non-free software, such as propietary drivers and restricted codecs (which can also be installed on Ubuntu, only they are not used by default)