A "satellite" is a special kind of tournament in which the prize is an
entry into another tournament. For example, a single-table satellite
might have a $100 buyin and award one seat to a tournament with a $1000
buyin. Satellites are a popular way for players to get into a high-stakes
tournament when they prefer not to buy in directly for such a large
amount. A famous satellite example is Chris Moneymaker's $40 buyin to a
World Series of Poker satellite: he eventually won the big event (which
costs $10,000 to buy in directly) and took home the $2.5 million first
prize.
Some satellites have more than one table and award more than one seat
into the bigger event. A satellite can have its own mini-satellites. Or a
satellite can be a FPP freeroll, where you use FPPs to buy in and the
prize is an entry in a real-money tournament. The real-money tournament
might even be offline, say, in Las Vegas. All sorts of combinations a
possible, such as a multi-level FPP freeroll into the World Series of
Poker.
Most tournaments are not satellites. They are just plain tournaments, in
which the buyins go into a prize pool and the prize pool is awarded to
the top finishers in the tournament.