Shared Space is a philosophy of movement made famous by the late Hans Monderman, a pioneer in the field of transportation and urban design.
The basic premise is that modern attempts at controlling traffic behaviour through the use of signage, barriers, signals, lights and other instructions are counter-productive and, in fact, lead to people feeling paying less attention to what they are doing - this results in more accidents, more delay and the death of the street as a place.
The alternative is to remove the signs, make no distinction between street spaces and allow users to navigate the space based on eye contact and common sense.
Of course, this mainly applies in areas where auto usage is fairly low, but is surprisingly effective on busy streets too.
The following links are good places to learn about these things:
Wiki - Shared Space
Streets used to be places where people interacted, where lives were lived and the heart of the community was found. Now we have roads and all they do is get us from A to B. Shared Space is a way of reclaiming the streets and finding a balance that does not favour one mode (cars) over any other.
Anyway, that's what Shared Space is.