A secret key is a hashing salt which makes your site harder to hack and access harder to crack by adding random elements to the password.
In simple terms, a secret key is a password with elements that make it harder to generate enough options to break through your security barriers. A password like "password" or "test" is simple and easily broken. A random, unpredictable password such as "88a7da62429ba6ad3cb3c76a09641fc" takes years to come up with the right combination.
For more information on the technical background and breakdown of secret keys and secure passwords, see:
- Ryan Boren - SSL and Cookies in WordPress 2.6
- WordPress Support Forum - HOWTO: Set up secret keys in WordPress 2.6+
- Wikipedia's explanation of Password Cracking
- Lorelle VanFossen - Protect Your Blog With a Solid Password
- Yahoo's Security Password Tips
- Yahoo Security - How to Choose a Password
- LifeHacker - Get high security passwords from Perfect Passwords
