Eye relief is the distance from the surface of the lens closest to the eye to the surface of the eye itself where the optimal image is seen through an optic. Eye relief is measured in millimeters for binoculars and spotting scopes, and measured in inches for rifle scopes.
For example, a pair of binoculars lists eye relief at 5mm. This means that the eye must be 5mm from the surface of the lens inside the eyepiece for the picture seen through the binocular to be the best quality. Too far away, and a black ring will appear around the picture through the binoculars. Too close and you'll see crescents of light on the edges of the visible picture, also known as vignetting.
Eye relief can be an issue for those who wear eyeglasses. Because eye relief is a fixed measurement, people with glasses may find that they cannot get physically close enough to the lens to achieve proper eye relief. There are many models of optics available that utilize long eye relief, or extended eye relief, to combat this problem. Extended eye relief simply means that the eye relief is far enough that comfortable viewing is achievable while wearing glasses.