The database table prefix is a string (a few characters long) prepended to the name of Joomla!'s tables. Using a prefix enables you to run multiple installations of Joomla! using a single database.

The database table prefix can be set during installation. Changing it later is possible, but requires access to the database through a non-Joomla medium or a Joomla Extension such as Akeeba Admin Tools and will cause some downtime.

Extension developers need to use the string #__ to represent the prefix. This will be replaced by the real prefix during runtime by Joomla.

Reference: http://docs.joomla.org/Glossary