I am aware that Satoshi Nakamoto is the author of the paper that originated Bitcoin and the creator of the original bitcoin client. However, I often hear the term Satoshi as if it was a monetary unit.
What is a Satoshi?
A Satoshi is the smallest fraction of a Bitcoin that can currently be sent: 0.00000001 BTC. In the future, however, the protocol may be updated to allow further subdivisions should they be needed.
Further examples of units
A Satoshi is a one hundred millionth of a Bitcion.
Bitcoins are delimited to eight decimal places so even if (when?) Bitcoins are worth $1,000,000 each, you can still do penny transactions.