Xml (extensible markup language) is used to describe the data and it allows more precise structuring of that data than in html (hypertext markup language). In xml, you can create your own tags and make syntax for those tags. Internet explorer used this xml documentation. Using java script, you can also reach the various elements of the xml page and make use of your data.
You can get more relevant information from these under mentioned links
http://msdn.microsoft.com/workshop/xml/index.asp : This provides a Microsoft discussion on XML.