As its name suggests, the PSP -- or PlayStation Portable -- is a smaller, lighter version of Sony's PlayStation. It's not as powerful as the PS2, but more powerful than the original PlayStation, and it has a built-in screen and speakers so you don't have to plug it in to anything to use it.
As with the full-size PlayStation2, which can play DVDs and audio CDs as well as PlayStation game discs, the PSP is more than just a gaming handheld. The PSP plays games in UMD (or Universal Media Disc) format, but UMD format is also used for movies and other audio-visual content, and the PSP can pay those, too. And if that isn't enough, the PSP can also play audio, video, and still image content off of Memory Sticks (Memory Stick Duo and Memory Stick Pro Duo are the compatible formats).
Unlike the PlayStation or PlayStation2, the PSP comes equipped with Wi-Fi, so you can connect with other players wirelessly and, if your firmware is version 2.00 or higher, get online to browse the internet. Sony has also announced an add-on camera and a GPS device for use with the PSP, expanding its capabilities even further.
o ceramic white (Japan and Europe only)
o pink (Europe only)
o Tsukimi -- black with copper (Japan only)
o Kachofugetsu -- white with black and red (Japan only)
Dimensions: 6.7"/170 mm wide x 2.9"/74 mm high x .9"/23 mm deep
Weight: .62 lbs/280 g (including battery)
CPU: PSP CPU (1-333 MHz)
o 32 MB Main Memory
o 4 MB embedded DRAM
o 4.3", 16:9 widescreen TFT LCD screen
o 480 x 272 pixels
o 16.77 million colors
o maximum luminance 180/130/80 cd/m2 (when using battery pack)
o maximum luminance 200/180/130/ 80 cd/m2 (when using AC adaptor)
o built-in stereo speakers
o headset connector
Connectors, Ports and Drives:
o IEEE 802.11b (Wi-Fi)
o USB 2.0 (mini-B)
o Memory Stick Duo
o DC in 5 V connector
o headset connector
o UMD drive (Read only)
Buttons and Switches:
o analog nub
o triangle, circle, cross, square
o right and left shoulder
o Start, Select, and Home
o display brightness, sound, volume up, volume down
o wireless LAN on/off
o UMD latch
o lithium-ion battery
o AC adaptor
o UMD region coding
o parental control
What Does It All Mean?
Basically, what all these fancy specs come down to is a kick-ass handheld gaming machine with amazing graphics for its size, that can also play movies and music, display photos and image files, surf the web and, with every new firmware release, even more cool stuff. Phew!
As for whether or not you should buy one . . . well, you'll have to decide for yourself, but I've never regretted buying mine.
source from: http://psp.about.com/od/pspbasics/a/whatisapsp.htm