I've had a few questions come in about RSS feeds, so I'm using my latest response to help explain this technology:
RSS is used in three ways:
1. In news readers.
I've got this functionality built-in to my Apple Mail program, so I get my "feeds" every day, and I have a separate "inbox" to read them. I've got tech news, updates from clients' sites (good for me to keep an eye and make sure they're working!), and other stuff like Flyers' news updates. This is nice because I am notified whenever these sites are updated and I can skim the headlines and intro's... then I can click the "read more" link if I want to see the whole article.
2. On other web sites.
You can also turn this same RSS feed you're using to stay up-to-date with your favorite site and display these articles on your web site. (Viola, current news on my site without having to update it myself!) We can grab ANY rss feed and put it on ANY site. It's all the same stuff.
3. For SEO-purposes.
We also use RSS feeds (in conjunction with things like pings, trackbacks, and comments) to boost a site's search ranking. Again, it's all the same technology, just used in different ways.