OpenVZ is an open source virtualization technology for Linux which utilities containers to run separate Linux based operating systems on a single machine. OpenVZ is typically used as it touts a low overhead, of around 1-3% of CPU, compared to other virtualization technologies.
OpenVZ is an open source operating system-level virtualization which integrates with the Linux Kernel, because of this OpenVZ can only run on Linux and can only run Linux containers which have compatible kernels. OpenVZ separates out virtual environments into "containers", which are similar to BSD Jails.
OpenVZ is not like traditional hyper-visor based virtualization technologies, such as Xen or VMware, in that is only runs a single patched Linux Kernel. This however lets OpenVZ be faster and more efficient than hyper-visor based technologies. Typically each OpenVZ container will have around 1-3% overhead of that if it were a physical machine.
OpenVZ is the basis of Virtuozzo Containers, which is commercial software distributed by Parallels Inc. OpenVZ is available under the GNU GPL v2 license.