Application Programming Interfaces, known as APIs, enable a business to expose content or services to internal or external audiences. It’s a way to share your data. Think of API as boxes of data and information that are being transported between electronic devices, such as computers, smartphones and tablets.

An API connects your business processes, services, content, and data to channel partners, internal teams, and independent developers in an easy and secure way. APIs are quickly becoming the de facto standard by which companies exchange data and build consistent cross-channel customer experiences.

An API sits between an app and the data. The app could be anything. The data could be in a database or simply in a text file.

For more detailed information you could search for APIs for Dummies.