The term applied by Google to their web advertisements, which are presented to the visitor according to the search term entered. Google's sponsored links are fairly unique in that they are purely text based and visually identifiable by background color (though they do not seem to be identified in an alternative, accessible way for screen readers and the like).
Though the links are text-based, they are presented in banner ad format and use JavaScript to ensure that a click anywhere in the ad area executes the link.
Sponsored links generally appear above the search results, spanning the length of the page. They may also appear in smaller boxes down the right-hand side of the page.