From the Official Google blog:
Google TV is a new experience for television that combines the TV that you already know with the freedom and power of the Internet. With Google Chrome built in, you can access all of your favorite websites and easily move between television and the web. This opens up your TV from a few hundred channels to millions of channels of entertainment across TV and the web. Your television is also no longer confined to showing just video. With the entire Internet in your living room, your TV becomes more than a TV — it can be a photo slideshow viewer, a gaming console, a music player and much more.
Guidelines for developers who wish to optimize their sites for Google TV are here. Google is working with Sony and Logitech to integrate TV sets, Blu-ray players and companion boxes with the offering, and compatible devices will go on sale this fall, at Best Buy stores throughout the USA. During today's launch event, Google execs showcased how Google TV will use the next generation of Adobe's Flash, which has been the subject of much controversy with Apple.