The "P2" of Eclipse P2 was derived from "provisioning platform", but it is generally referred to by its acronym. It was created to improve the provisioning story not only for features and bundles, but also for non-Java content such as native executables and configuration files.
Note
An overview of P2 and its history is available from the online Eclipse help, also visible at http://help.eclipse.org/luna/topic/org.eclipse.platform.doc.isv/guide/p2_overview.htm.
There are a few key concepts to understand in P2:
Artifact: This is a collection of bytes, such as a plug-in, feature, or product
Metadata: This is the information about artifacts, including versioning information and dependency information, which is referred to as Installable Units (IUs)
Repository: This is a collection of artifacts (an artifact repository) or metadata (a metadata repository) that may be hosted on a remote site
Composite Repository: This is a composition of one or more repository references