An impression, in the context of online advertising, is a single view of an ad by one individual. Online publishers offer their ad inventory as available impressions and advertisers buy from them in the same terms.
Since a single web page can contain multiple ads (depending on its design), a site usually registers more ad views per unit of time than web pages per unit of time. (Hits is the term for any requested file, including each of a page's images. Although hits are of interest for traffic measurement purposes, they have no significance for advertisers.)
Page or ad impressions are documented in a log that is maintained by the site server. Programs like Web Trends read the log, abstract meaning from it, and generate a report about site usage. Other programs, such as Central Ad, can keep track of all ad impressions that have been sent and how many of these were clicked on by users.