MUD ¹ stands for 'Multi User Dimension', or sometimes 'Multi User Dungeon'. A MUD is an online space, usually text-based, where a number of people can meet and interact virtually. In some MUD's there is an overarching plot or adventure which the characters take part in, in others there is little more than a space in which people can meet and talk (rather like a chat channel). Part of the fun of MUD's is that they combine the roles of player and games master, often allowing users to build their own sections of the virtual environment.

There are many acronymic variations on MUD, though MUD is used as an overarching term.

MOO.
'Object Oriented MUD' The term MOO is generally used for MUD's running from the LambadaMOO server program.

MUCK.
A social (as opposed to adventuring) MUD.

MUSE.
Again a social MUD that uses a class and combat system

MUSH.
'Multi User Shared Hallucination' a social MUD that allows building. A variation of the TinyMUD server.

MUD's are commonly thought to be the most roleplaying-like of online environments, since they most closely reproduce the effects of traditional RPG's. Many would claim that MUD's are more roleplaying than roleplaying, since there is no need to ever step out of ones assumed character.

1. Note that University of Edinburgh computing regulations forbid us from actually including a list of MUD's.