CAN stands for Control Area Network. It is a form of multiplexed wiring designed by Bosch and allows the linking of a number of control systems together, normally in a vehicle, so that they can share information.
In the past it would have been necessary to have at least one wire for every signal on a vehicle making wiring looms bulky and expensive. CAN bus multiplexing allows a large number of signals to be transferred digitally using only a pair of twisted wires.
Sharing of information also reduces the number of sensors that are needed. For example, the engine controller has its own sensor to monitor coolant temperature. Using CAN it can periodically broadcast the temperature reading so that the information is available to any other systems on the car that are interested. One such system might be the instrument cluster, which would use the information to drive its temperature gauge.