It is when you outsource the work to someone who is skilled in that particular field. For instance, if you need PHP web coding for a website, you can freelance the job to anyone skilled in PHP, nationwide or anywhere.
It means that you aren't actually working for one particular person. I heard it was based off the possibility of a retiring soldier to take a bonus or keep their sword or lance. Keeping their weapon would let them become a mercenary who had no master. So , basically it just means that you take jobs as they come and work for whoever you feel like. No annual salary, no benefits, but you control your work schedule and can work in a manner that pleases you.
Avarian that's an interesting story. Desmond: When you hear that someone is a freelance writer, freelance designer, freelance programmer, freelance 'insert whatever you want here'. It means they work on a contractual basis -- This means they will work for YOU if you can agree on a fee with them. If for example you need to design a header graphics or logo for your website you could go to a freelance designer and pay him let's say 30-50$, and he will work for you. Yes, you can earn money from freelance jobs... but only if you have a valuable skill. The more valuable the skill that you have to offer is, the more demand and the more competent you are in a particular field and the more money you can ask. For example if you were to offer freelance services for cleaning the floor, you will not get much because EVERYONE can do this. But if you were to offer freelance services for let's say programming or graphics designs, then you will get more money simply because NOT everyone can do this... therefore is more valuable.
Yes there can be freelance SEO services, in fact, there can be freelancing in many other fields such as video editing, writing, etc.
Freelance basically means that you are your own boss where you take on projects of any nature but not specifically for a specific company or of a permanent nature. For example, today you may take on a job doing web design for a retail shop and then tomorrow you do a SEO Service for someone else. The next day you sell fish in the market. Sort of a jack-of-all-trade but you sort of just do when you want to work and you decide what work you want to do and if you do not want to do any work then you don't work. Of course, you can earn from freelance. You will charge a fees which you typically agree with the one who hire you for the job. As to whether it is profitable, it depends on your skills, the type of jobs you take and if you are ambitious in your work.
A simple definition, Specialize in a particular field and earning from it is called freelance. Working for a company does not classify as freelancer.
Yup, this just about sums it up. What in particular are you going to freelance in? What is you main skill?