Knoppix is a bootable CD. Knoppix is also referred to as a liveCD. The CD contains a collection of GNU/Linux software (Debian Linux with LXDE desktop), automatic hardware detection, and support for many graphics cards, sound cards, SCSI and USB devices and other peripherals.
Knoppix can be used as a Linux demo, educational CD, rescue system, or adapted and used as a platform for commercial software product demos. It is not necessary to install anything on a hard disk. Due to on-the-fly decompression, the CD can have up to 2 GB of executable software installed on it.
A more detailed definition can be found at the Wikipedia article on Knoppix