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Checks and balances is a term referring to the distribution of power between different branches of government; In the US these branches are the Judicial Branch, the Legislative Branch, and the Executive Branch.

Each branch of the government has powers (checks and balances) that prevent the other two branches from having absolute power. The Legislative Branch creates the laws, the Executive Branch enforces these laws, and the Judicial Branch interprets and modifies these laws.

Here are examples using the US government (although the term applies to systems of government other than the US as well) :

1) The Legislative Branch, composed of the house of representatives and the senate, may pass a bill. However the Executive Branch (the President) may veto that bill.

2) The President (Executive Branch) may declare war. However this declaration must be approved by a majority vote in the senate.

3) The Judicial Branch may interpret the laws and punish those who break them, but they themselves may not create laws.

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