From LQWiki

Retcon is a writing term where you change something retroactively (RETroactive CONtinuity?)

One example of this would be in Star Wars where in the first films the force is considered an unknown force that everyone has, although few are able to 'feel' it. In the later films they changed this to being from midichlorians, a symbiotic lifeform that allowed someone to control the force. The more a person had the stronger they were.

Quite often this is used for a plot point. In one Star Trek episode, for example, they needed to beam someone onto a ship travelling at warp. Since they had previously said this was impossible, it was 'retconned' so that it was possible if the two ships are travelling the same speed.