Buddypress adds community features (member profiles, messaging, groups, friendships) to WordpressMU: the multiblog version of Wordpress. The future seems bright for BP, and after this hot testing period the guys are working to extend these features to the common WordPress blogs also. So you are adviced:  stay tuned!

Here’s a brief description directly taken from the official site:

BuddyPress is essentially a set of WordPress MU specific plugins. Each plugin component adds a distinct feature to BuddyPress and only handles functionality for that specific component (for example, private messaging). BuddyPress also has a core plugin that all other plugins require, it contains shared functions and performs the basic modifications to the WordPress MU interface.

It also means BuddyPress can be used in two different ways. You could use BuddyPress to create a complete social network from scratch, or you could use it to add desirable features to your existing blog network.

Here some screenshot of the default BuddyPress aspect: