Definition: Caffeine is Google's next generation search engine infrastructure. Caffeine is intended to be similar to the existing search engine technology, only faster. Hence the name. That won't mean there aren't any changes in search results.
As Google employee Matt Cutts put it, "This update is primarily under the hood: we’re rewriting the foundation of some of our infrastructure. But some of the search results do change, so we wanted to open up a preview so that power searchers and web developers could give us feedback."
Google is playing with the technology on a public sandbox at ww2.sandbox.google.com.
