A ND filter is a grey glass filter that reduces the amount of light entering the camera lens. Basically, it works in the same way your sunglasses reduce the dazzle of the sun for your eyes.
ND means "neutral density", as ND filters can in fact reduce the amount of light entering the lens without affecting color rendering and color reproduction. ND filters usually come with a numeric value, like ND4, ND8 etc. The higher the number, the more you can slow down the shutter speed.
The numeric value also shows the amount of light reduced. For example, ND4 = 1/4 light amount reduction, ND8 = 1/8 light amount reduction, and so on. On ND filter packages you may also find indications like "3 stops light loss", etc. This indicates how many aperture stops you will lose when using ND filters. For example, a "1 stop light loss" means approximately a 50% reduction in light amount, a "2 stops light loss" a further 25%, a "3 stops light loss" a further 12.5%, and so on.
