Cloaking, meaning making invisible (a la Star Trek), is a black-hat search engine optimization technique.
The original version of this was to put text in a color the same as the background. You wouldn't see it on the page.
The term has come to mean any technique which shows a different look to a website visitor than it does to Google.
They are black-hat because they are efforts to trick Google rather than to work WITH Google and what it is trying to do - which is of course to serve up the most useful results to a searcher.
From time-to-time, people develop new methods of cloaking. Sooner or later (these days, often sooner) Google updates its algorithms to defeat them.
Here are some common cloaking methods. If your webmaster wants to (or is) using them, slap him down hard. Even if they work temporarily, sooner or later, Google will catch on, and you'll be back where you started, or worse:
Text same color as background.
Text several screens below the "bottom" of the page where no one will scroll to see it.
Text in a tiny font nearly the same color as the background.
Text in the source code (other than meta description tags), coded so it isn't displayed.
Pages which redirect after a short time to another page.
Pages only reachable from links which are nearly invisible (such as one pixel images).