Open source hardware refers to computer and electronic hardware that is designed in the same fashion as free and open-source software.
Open source hardware is part of the open source culture that takes the open source ideas to fields other than software.
An example of this is the Simputer project.
Some of the impetus for the development of open source hardware was initiated in 2002 through the Challenge to Silicon Valley issued by Kofi Annan.[1] Because the nature of hardware is different than software, and because the concept of open source hardware is relatively new, no exact definition of open source hardware has emerged.
Because hardware has direct variable costs associated with it, no open source software definition can directly be applied without modification.
Instead, the term open source hardware has primarily been used to reflect the use of free/open source software with the hardware and the free release of information regarding the hardware, often including the release of schematics, design, sizes and other information about the hardware.
The freely released information includes the hardware design and element distribution on the motherboard (i.e. a notebook where one can replace elements.)[2][3]
Source: Wikipedia (http://en.wikipedia.org/wiki/Open_source_hardware)