Albedo is a measurement of a surface's ability to reflect diffuse light (mirrors reflect specular light, bright white objects reflect diffuse light). An albedo of one (or 100%) would mean that a surface is reflecting all the light that hits it, and an albedo of zero would mean that the surface is pure, absolute black, reflecting no light at all.
The albedo effect, sometimes referred to as the 'snow-temperature feedback effect' or 'ice-albedo feedback effect', refers to positive feedback loops acting on the surface of the Earth, in which a change in albedo alters the temperature of the environment causing the albedo to change even more drastically.
Snow and ice have high albedos, up to .9 (90% of light energy reflected). This reflects not only light, but also the solar energy that would warm the ground. Thus ice-covered ground does not receive the heat energy that bare ground receives. Once ice and snow start to melt, more of the sun's energy can reach the ground and be absorbed, warming the ground, and causing the snow to melt more quickly, which warms more ground and causes more snow to melt which warms more ground.... This feedback loop can cause snowpacks and ice fields to disappear with surprising rapidity.
The same thing happens with water; once a puddle of water forms on an icepack, the water will absorb more heat than the ice, causing more ice around and under the puddle to melt, creating more warm water, melting more ice, and etc. Likewise, as ice sheets over the oceans melt, the oceans warm up, melting more ice sheets. These are not technically instances of the albedo effect, as water is considered to be an example of specular reflection rather than diffuse reflection, but the end result is the same. The melting of glaciers and ice sheets is sped up.
These warming effects have been in the news lately, as we see our ice sheets and ice caps melt away. But the effect works both ways; a drop in temperature could lead to an increase in snow cover on the ground leading to a drop in temperature.... This sort of feedback loop probably helped create the ice ages of the past, and the warming feedback loop we are seeing now was partially responsible for the warmer periods of pre-history. These hot and cold periods have always been a part of the Earth's long term environmental changes.
Of course, the sudden change that we are seeing now is largely our fault, and the sudden changes the Earth will be going through in the next century will not be fun for us. As glaciers melt and disappear, the people who depend on them for water (large portions of India, China, and South America, among others) will suffer (and yes, many will die); as the ice at the poles melt oceans will rise, flooding coastlines the world over, including many major cities and good cropland. By fortunate coincidence, many of the richest and most industrialized countries in the world have large coastal cities (or are in fact entirely situated on small islands), and really need their coastal lands. This has caused a strong increase in the number of laws and incentives intended to reduce global warming, in the hope of shutting down the albedo effect feedback loop before it floods us out. But they still need your help.