In a nutshell it's a domain that is owned and exists online but doesn't show any real content. It may however show some advertising (most do). Most of the hosting companies offer domain parking. Someone parks a domain if they buy (or own) it but don't want to develop it immediately.
also some domains get a huge amount of type in traffic or traffic due to similar sounding domains that are pretty famous..
you can also park your domains in your site. like if you have www.naxos-rooms.com and you parked at the same site www.naxos-island-hotels.com hope this help you.
Unless you have a domain name that has lots of type in traffic or traffic from typos, its very hard to earn from parking your site.