An "audio interface" is basically the link between your music and your computer. You put your microphone, instrument, & midi inputs into your audio interface which hooks up to your computer so you can work with it in your DAW. (DAW stands for "Digital Audio Workstation" and these days it usually refers to multitrack recording software such as Nuendo.)
For anyone doing computer based recording it's an absolutely essential part of your recording setup. Most audio interfaces now come with some type of DAW (although it's usually a pretty basic stripped back version.) Some audio interfaces are really only meant to be used with a specific DAW (for example Pro Tools gear includes both an audio interface and the DAW.)
You need to make sure that the audio interface you buy works well with your computer (some work better with PC and others work better with Macs. In some cases they may only work with one or the other.)
You should also be aware of the different types of ways they can hook up to your computer. PCI, USB, and Firewire/1394. If you want a PCI based audio interface (such as the E-MU 1616M that I use) then make sure you have an open PCI slot. Likewise if you want a Firewire/1394 based audio interface makes sure you have that hook up on your computer, a lot of them don't. I do not recommend a USB based interface because USB is not as fast as PCI or Firewire.
Buy An Audio Interface Online
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 Mackie Onyx Blackjack 2X2 USB Audio Recording Computer Interface  US $120.00
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 Samson G Track USB Microphone and Audio Interface US $80.00
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 M Audio MobilePre Recording Interface US $55.00
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 Avid Mbox Mini Ultra Compact 2x2 Audio Interface US $197.99
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 Focusrite Scarlett 8i6 Audio Interface US $199.99
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 Yamaha USB Audio Interface UW10 US $39.50
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