A domain name is the main part (the part ending in .com, .org, .edu, etc.) of the address you see in your internet browser's address bar.
This is usually called a 'friendly' address because it's much easier to read (and remember) than the related IP address that also identifies your site's location on the internet.
To reach another person on the Internet you have to type an address into your computer. That address can be a name or a number. The name and number are known as identifiers. Every identifier has to be unique so computers know where to find each other. Having duplicate identifiers (for different websites) would be the same as sharing the same address with someone in another part of the city. It just can't be done.
ICANN is the organization that coordinates these identifiers. Without this coordination, there would be no global Internet.
To put it another way, every computer has its own IP (Internet Protocol) address, a sequence of numbers used to identify every computer connected to the internet; the identifer is stored in Domain Name Servers that act like telephone books for the Web. To see what your IP address is, visit IP Chicken.
If you look at the address bar for this web page (the one you're reading right now), you'll see that our domain name is ctdsonline.com. Http is a prefix that indicates that the browser is using the HyperText Transfer Protocol to access and display the page (as opposed to one of the other internet protocols, like the File Transfer Protocol, or ftp, for example).
Next: Registering your domain name...