Bit Torrent is a file shearing program. Bittorrent uses a torrent file.
Short Answer:
BitTorrent is a popular filesharing protocol
Users browse the web to find a torrent of interest, download it and open it with a BitTorrent client
BitTorrent users cannot remain anonymous; it is possible to obtain the IP addresses of all current, and possibly previous, users
Slightly Longer Answer:
BitTorrent can distribute large amounts of data widely without the original distributor incurring the entire costs of hardware, hosting and bandwidth resources
There are numerous compatible BitTorrent clients for various operating system and formats
As recipients download data, they simultaneously upload as well to newer recipients, reducing dependence upon the original distributor
The protocol was released in July of 2001 by Bram Cohen
BitTorrent trackers have been subjected to raids and shutdowns due to claims of copyright infringement
Please see Mahalo's BitTorrent search result page for more information.