A link farm is a website set up with the sole purpose of increasing the link popularity of other sites by increasing the number of incomming links to those sites. They are typically made up of long lists of unrelated links. Some link farms are created as networks of sites that contain numerous links to one another.
Nearly all search engines remove link farms from their directories when they find them. And many also penalize other sites that link to them. It is not a good idea to link to a link farm if you rely at all on organic search for pageviews.