A persona is a typical or archetypical person who represents the intended audience of your solution.  The persona serves two purposes:

1. It is an empathy machine, reminding the project team that there is a real person who will be using the solution
2. It gives focus to the team, showing them what is important to the intended audience, and what is not, so that the team isn't tempted into thinking that the audience is just like them.

Personas should focus on goals and frustrations, and be able to communicate how each person goes through their daily lives, and give clues to the environment or or environment that the solution must accommodate.

An example below, of a Nuclear Medicine Technologist.  Amazingly enough, her day isn't much like your average web application developer.