Polymorphism is a way to abstract the development process of Object
Oriented languages that allows you to decouple the the doing parts of
the code from the conceptual way you design the application.

Most people see Inheritance as polymorphism, which is partially right
from a really limited level; inheritance is a part of polymorphism.

As a really limited example of polymorphism; when you place an object
into a collection of some sort they come back as Object. You have to
tell Java what Object they where before.

CastedObject bob = (CastedObject) i.next();

The ability for all Objects to be treated as Objects is the essence of
polymorphism.

For a really good answer, I would go find a popular book on the matter
(thinking in java, sams java in 24 hours, the complete java reference 2)
and read about it.

Basicaly if you don't understand polymorphism you don't understand OO
programming.