In photography, as Webster suggests, a negative is what appears on photographic film after it's been exposed and developed.
A negative has all light areas dark, and dark areas light - and colors inverted. When the photograph is enlarged, light is projected through the negative, and the dark areas form a shadow on the photographic paper, making them less exposed to the light - this inverts the negative's picture forming a positive on the paper.
This now-common process was first done by William Henry Fox Talbot in calotypes in 1840, and further refined by Frederick Scott Archer in wet plate process in 1851. This way of making photos was cheap compared to daguerrotypes and other straight-to-positive things, and it also allowed to make unlimited copies of the picture.
It should be noted that a negative on a modern photographic film is not simply a picture with all colors negated! The film itself is not completely transparent: Black and white film is purplish, and color film is brownish. Thus, if you make a raw scan of the film with a film scanner, you need not only invert the color, but also compensate for this (tips for this should be given here sooner or later) - fortunately, most scanner drivers do this automagically.
(The history bit taken from http://www.photo.net/history/timeline )