A NIDS is a Network Intrusion Detection System, a system to detect intrusions from the network and take counter-measures ranging from (temporarily) blacklisting to logging through responding with specially crafted IP packets to slow down or kill the attacking host.
It extends the principle of IDS to the network. It is usually meant to run on a firewall or a sensitive server.
Snort is one such NIDS.
This article was first written in October 2003 for the BeezNest technical website (http://glasnost.beeznest.org/articles/65)