DMO stands for Dynamic Management Object; these are a set of system objects stored within SQL that allow us to look into our instance and retrieve various bits of information about its current state - and a bunch of other things!
The actual objects are DMVs (Dynamic Management Views) or DMFs (Dynamic Management Functions). These are exactly the same as "normal" views or functions although they are held within the system schema.
These objects are used in a wide range of activities and I consider them to be the fundamental building blocks of any monitoring or tuning script or application. There is of course a vast number of DMO's available and over the course of writing this blog I will be putting together some introductory articles on the ones that I commonly use.
Here are some links to get you going:
Building a monitoring script with DMOs
Troubleshooting with Wait Statistics
SQL Server: Working with Dynamic Management Objects (via TechNet)