From Wikipedia, the free encyclopedia∞
A Live CD is an operating system (usually containing other software as well) stored on a bootable CD-ROM or DVD-ROM that can be executed from it, without installation into permanent memory, such as a hard drive. The system returns to its previous OS when the LiveCD
is ejected and the computer is rebooted. It does this by placing the files which typically would be stored on a hard drive, into temporary memory, such as a ram disk. This however does cut down on the RAM available to applications, reducing performance somewhat.
More information about it can be found over here, http://en.wikipedia.org/wiki/LiveCD∞