Open Source & Derivative Works
WordPress & the GPL
ProCD v. Zeidenberg
USL v. BSDi
Shrink Wrap License
MS Community License
MS Permissive License
EULA is short for an End-User License Agreement, and is a contract between the licensor (usually the author/developer) of software and the purchaser/user. The EULA typically grants the purchaser/user the right to use the software, but may also place limitations on permissible uses. Additionally, many EULAs also prohibit reverse engineering (and in some cases even publishing performance data on the software), and some EULas may also place limitations on the licensor's liability (or consequential liability) in the case of disputes, as well as terms and conditions on how disputes should be resolved (such as requiring arbitration and/or specifying the court venue), etc.
EULA's are typically used for proprietary software, and may be displayed on the product packaging, within the product packaging ("shrink-wrap license"), or during the installation process (a "click-through license").
There has been much debate about how enforceable EULA terms and conditions are, and it is not possible to give a general answer. The relevant issues include the jurisdiction (since rules on interpreting and enforcing contracts vary between different legal jurisdictions), whether the purchaser/user could review the terms before making the purchase (if he could not, this might to make the terms less enforceable, unless his subsequent actions suggested consent to the terms), and whether the terms were considered unfair, unconsciousable, or beyond the reasonable expectations of the user/purchaser (since the EULA might be considered a contract of adhesion in some jurisdictions).
Finally it should be noted in the case of ProCD v. Zeidenberg, a US court did find a click-through EULA to be enforceable.