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Unzipping is the act of extracting the files from a zipped single file or similar file archive. If the files in the package were also compressed (as they usually are), unzipping also uncompresses them.
When you download programs from shareware or freeware companies on the Web, they almost always send you a zip file (the file name has a suffix of ".zip"). You can usually extract the files from a zipped file just by double-clicking on it since many archives include a "self-extracting" program. Several popular tools exist for zipping and unzipping: PKZIP in the DOS operating system, WinZip in Windows, and MacZip in Macintosh.