Simon Willison explains what it is:

Stable Diffusion is a new “text-to-image diffusion model” that was released to the public by Stability.ai six days ago, on August 22nd.

It’s similar to models like Open AI’s DALL-E, but with one crucial difference: they released the whole thing.

And why it’s a really big deal:

In just a few days, there has been an explosion of innovation around it. The things people are building are absolutely astonishing.

He then details some of the innovation and it is staggering, to say the least. Open FTW!