MOLLE (pronounced MOLLY as in the female name) is an acronym for MOdular Lightweight Load-carrying Equipment. It is used to define the current generation of load-bearing equipment and rucksacks utilized by the United States armed forces, especially the United States Army, and its use is also growing in the British Army in the form of the Osprey Modular systems. The system's modularity is derived from the use of PALS webbing, rows of heavy-duty nylon stitched onto the vest as to allow for attachment of various MOLLE-compatible pouches and accessories. This method of attachment has become a de facto standard for modular tactical gear, replacing the click and stick system used in the earliest modular vest systems (which is still in use with most Western police departments). It is produced for the United States Government under contract by several contractors, such as Specialty Defense, Armor Holdings as well as Eagle Industries.
As far as the gear there is really no easy was to describe all the various systems. The gear is broken down into various components. The two main components are the tactical vest and the large pack with external frame. The other components are typically smaller pouches and packs that attach to either the vest or the larger packs. The military issues the large pack and frame to all and then different pieces depending on the soldiers role/job. The gear is nice because you can customize your set up any way you like and all the different pouches can be used for whatever you need since they come in all shapes and sizes. For instance, I use the "fragmentation grenade" pouch to carry my lensiatic compass in. It fits perfect. Also the various single clip ammo pouches are great for flashlights. I have one (I think its an M1 ammo pouch) and it holds my Surefire flashlight nicely.
Also, more and more companies are now offering MOLLE compatible pouches for their gear. Leatherman and Surefire both have pouches that can attach to MOLLE systems.
One thing I would make note of is that if you are going to buy a MOLLE system for your gear. Get true MOLLE gear. made by SDS or one of the other military contracted companies. There are a ton of cheaper knock off MOLLE packs out there that are just simply not the same quality. You can get a ton of trule military issue or surplus MOLLE gear on ebay at really decent prices (hence the link in the original post here). The DCU or desert camo is the easiest to find as the military switched to the ACU camo pattern within the past few years. A bit surprising is the fact that the traditional woodland camo MOLLE gear is rather hard to find. I guess it is because the military doesn't really use that camo pattern much these days.
This is a link to SDS and the various MOLLE parts that they manufacture. Like I said above, you can get the gear cheap on ebay (even new pieces) but this will give you an idea of how many different combinations you can create.
http://www.specialtydefense.com/c-24-load-carrying-equipment.aspx