Its a copy of an object, so lets say you have 5 of the same sprites next to each other:
<img src="http://profile.ak.fbcdn.net/hprofile-ak-snc4/50493_175211602550_483061_q.jpg" border="0" /> <img src="http://profile.ak.fbcdn.net/hprofile-ak-snc4/50493_175211602550_483061_q.jpg" border="0" /> <img src="http://profile.ak.fbcdn.net/hprofile-ak-snc4/50493_175211602550_483061_q.jpg" border="0" /> <img src="http://profile.ak.fbcdn.net/hprofile-ak-snc4/50493_175211602550_483061_q.jpg" border="0" /> <img src="http://profile.ak.fbcdn.net/hprofile-ak-snc4/50493_175211602550_483061_q.jpg" border="0" />
Each of those are an instance of the 1 type of sprite (eg: Sprite1 instance 1, Sprite1 instance 2, Sprite1 instance 3, Sprite1 instance 4, Sprite1 instance 5).