Waterfall is a project management approach where a project is completed in distinct stages and moved step by step toward ultimate release to consumers. You make a big plan upfront and then execute it linearly, hoping there won't be any changes in the plan. Once all the activities are put on a Gantt chart, they resemble the slopes of a waterfall, hence the name.
Waterfall was the first software development methodology inherited from the manufacturing and construction industry where you can't afford to iterate. The main difference between Waterfall and Agile is that Waterfall doesn't react well to frequent changes, which is why it gets a bad reputation.