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API stands for Application Programming Interface, i.e. API is the way for an application to interact with certain system/application/library/etc. For example, there are API's for OS (WinAPI), API's for other applications (like databases) and for specific libraries (for example, image processing), etc. APIs are usually developed in a form consumable by a client application.
In most procedural languages, an API specifies a set of functions or routines that accomplish a specific task or are allowed to interact with a specific software component. This specification is presented in a human readable format in paper books or in electronic formats like eBooks or as man pages.n such languages, the API is still distributed as a library. For example, the Java language libraries include a set of APIs that are provided in the form of the JDK used by the developers to build new Java programs.