There are many different definitions circling around tech world. Most of explanations are long and include some form of Ajax, Web Services elements and minimal page refresh web design characteristics. But the simplest definition yet, that I came across was given by InformationWeek magazine:
Web 2.0 is all the Web sites out there that get their value from the actions of users.
Wikipedia, Digg, Technorati, Filckr are the perfect examples.
Dautovic 