SQL Injection is one of the many web attack mechanisms used by hackers to steal data from organizations. It is perhaps one of the most common application layer attack techniques used today. It is the type of attack that takes advantage of improper coding of your web applications that allows hacker to inject SQL commands into say a login form to allow them to gain access to the data held within your database.
In essence, SQL Injection arises because the fields available for user input allow SQL statements to pass through and query the database directly.
Read more for an in-depth explanation and examples of SQL Injection vulnerability @ http://www.acunetix.com/websitesecurity/sql-injection.htm