What does "#" mean in twitter?

[Do as I Say, Not as I Do]

[dannymot]

It highlights the word as a search term so you could then read all posts with that term.

So

"I cannot wait till #glasto"

then searching glasto would bring up everyone talking about glasto.

[Nick]

a hash tag is used as a tagging marker for creating lists and groups. so anyone tweeting about a certain subject e.g #yahoo to tweet about yahoo would be able to see all the posts using #yahoo to see what other people had put about the subject. This was used a lot during the iran election protests and saved lives (#iranelection)

[x.o.x.o :]]

its used so it can be click on and it shows all the other people who used the content.

ex from my sis' twitter.
#MichaelGrant
and if click on it, it shows all the twits that include #MichaelGrant