Your net worth is the total of all your assets (cash, investments, house, etc.) minus the total of all your liabilities/debts (credit card debt, student loans, car loan, mortgage, etc...). If you've been following along you've noticed that I update my net worth monthly for everyone to see. It's a good way to keep track of your progress along the path of paying off debts to saving to investing to financial independence.
Dividend Mantra had a good post today about yournet worth. I'd never really thought of my net worth compared to my starting point as a new born baby. It can be pretty eye opening as it was for him to realize you've been around for 20+ years and would have nothing to show for it if you completely liquidated everything.