Hidden text is that which is displayed in such a way as to be readable by a computer visitor but invisible to human readers. A common technique might be to add text in white over a white background. This text will only be visible to human readers who know it’s location and highlight it in some way.
Old SPAM techniques included a lot of use of invisible text. This is because it allowed the inclusion of lots of phrases and keywords that would be readable to the search engines but not to your human readers so the readability and appearance of your sales page would not be compromised – or could even be on a different topic. Search engines have become much more able to determine whether a page is actually human readable and often will exclude content which is not – this has significantly reduced the prevalence of these techniques.
There are some legitimate uses of hidden text. For example a poker forum displaying some analysis of a hand might want to hide the result of the hand so that users can discuss the hand without being impacted by the results before simply highlighting the hidden area to read the missing text. However, given the search engine’s attitude to it I would suggest a better solution such as a sliding area to reveal the hand would both be more stylish and less likely to get the page de-listed.