Wikipedia
CoinJoin is an anonymization method for bitcoin transactions proposed by Gregory Maxwell. The following idea is behind CoinJoin: «When you want to make a payment, find someone else who also wants to make a payment and make a joint payment together». In case of such a joint payment there will be no way to relate input and outputs in one bitcoin transaction and thus the exact direction of money movement will remain unknown to the third party.
There are several implementation of anonymous bitcoin transactions inspired by CoinJoin: SharedCoins, Dark Wallet, CoinShuffle, DarkSend feature of Dash and JoinMarket.
CoinJoin-based mixing methods increase privacy for everybody - even those not using mixing, because it's no longer likely that all inputs to a transaction come from a single wallet, and hence you can no longer associate them to a single person.