It’s a domain for which the name plus the extension can be read as a whole word or a sentence.

The “hack” represents a trick (as in programming), not an exploit or break-in (as in security).

Word examples:

Delicio.us, Inter.net, Blo.gs, Doma.in, Bab.es, Mexi.co, Stov.es

Sentence examples:

Eat.me, Buy.it, Call.us, Meet.me

Domain hacks offer the ability to produce original and funny short domain names.