OS means operating system.
The operating system is what runs a piece of technology, whereas an app allows you to do something in particular. for example the calendar app lets you create a diary on your iPhone.
When Apple create operating systems for their mobile technology like iPads and iPhones they call the operating system IOS.
The current IOS is at version 6 and this is what allows so much great functionality on your iPhone!
Watch the video made by Apple for an overview of this functionality.
Apple video
Apple IOS page
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