LARP is an acronym for Live Action Role Playing.
Basically, instead of sitting around a table playing a role-playing game, you dress up and act as the character. It is a melding of game, improvisation, and theatre.
There are no dice to role in order to determine an outcome of an encounter or challenge against a creature or against another character; instead, traits on a character sheet are compared and used and the challenge is determined by a round (or more) of Rock, Paper, Scissors.
There are many different types of traits and abilities that a character can possess, and these help shape the character and what the character may be able to do.