In music, an
arrangement is a translation of a piece of
music to a different
instrument or collection of instruments from that for which it was originally written. An arrangment may just be a reduction for a single-instrument (
piano in particular), or it may also be meant to simplify the original piece (at your local music store, you'll see
authentic transcriptions and
Easy Piano Versions of popular music).
The art of arranging tends to evolve over time -- certain instruments or voicings will be favored in certain regions and during certain eras. To differentiate from a setting, all arrangements of a certain piece generally have the same theme or melody, while settings just share texts.
One of the most active types of arranging right now in America actually doesn't involve instruments at all -- it's a cappella arranging to cover modern popular music, in the college a cappella community. The advent of vocal percussion has changed the art somewhat, allowing the tonal voices to focus on melody and harmony rather than rhythm, but a great a cappella arrangement can give the proper rhythmic feel without requiring VP at all.