Pyjamas is a Rich Internet Application (RIA) Development Platform for both Web and Desktop.
It contains a Python-to-Javascript compiler, an AJAX framework and a Widget Set API. Pyjamas started life as a Python port of Google Web Toolkit, the Java-to-Javascript compiler. Read the FAQ and the list of features.
Pyjamas Desktop is the Desktop version of Pyjamas
Pyjamas Desktop allows the exact same python web application source code to be executed as a standalone desktop application (running under Python) instead of being stuck in a Web browser.
For Free Software platforms, most Linux Distributions now come with Pyjamas and Pyjamas Desktop pre-packaged: Debian/Testing, FC13, ArchLinux and Gentoo.
For Windows, Pyjamas Desktop uses MSHTML. Since MSHTML comes pre-installed on Windows (as part of IE), there is very little extra to download (other than Python itself).
You can write web applications in python - a readable programming language - instead of in HTML and Javascript, both of which become quickly unreadable for even medium-sized applications. Your application's design can benefit from encapsulating high level concepts into classes and modules (instead of trying to fit as much HTML as you can stand into one page); you can reuse - and import - classes and modules.
Also, the AJAX library takes care of all the browser interoperability issues on your behalf, leaving you free to focus on application development instead of learning all the "usual" browser incompatibilities.
Fear not - you are not alone: the true purpose and nature of Pyjamas is blissfully opaque to many. Will and Abe come to the rescue, with their Guide to Pyjamas. On mature reflection, however, it's probably best to read the FAQ and then contact the people on the mailing list.
The code for the Pyjamas Web Site, which is itself a Pyjamas application, was written by Luke Leighton. It has some pretty cool features, none of which "stand out", which is as it should be. Technology is not there to "dazzle" people or get in the way by promoting itself and its own "glory": it's there to make peoples' lives simpler and easier.