Taken from
http://www.tweak3d.net/3ddictionary/
Vsync - Stands for Visual or Vertical Synchronization. The Video Card's ability to synchronize buffer swaps with the monitor's refresh rate, obviating known visual artifacts and anomolies. Some manufacturers allow the disabling of this feature, which will usually increase framerate, while degrading image quality.
Which, in my understanding, means the frames are usually stored in the video cards memory, until the monitor has finished showing the previous frame. Enabling it means every frame will be shown when the video card needs it to be, but not every frame will be drawn completely.