According to the WordPress.com support page on short codes they are defined as follows:
A shortcode is a WordPress-specific code that lets you do nifty things with very little effort. Shortcodes can embed files or create objects that would normally require lots of complicated, ugly code in just one line. Shortcode = shortcut.
Many WordPress plug-ins make
More at: http://weblogtoolscollection.com/archives/2010/01/16/real-time-find-and-replace-plug-in-review/