1. Short for TeleTYpewriter, TTY is a communications setup that has a keyboard and a printer. Each time a key is pressed it is automatically printed to the paper, later modern TTY machines print to a screen. Teletype machines were available in three different modes: Automatic send and receive (ASR) -- Able to send and receive, Receive Only (RO) -- only capable of receiving data and not sending, and Keyboard Send and Receive (KSR) -- TTY with keyboard capable of sending and receiving data.
2. Today, TTY is also used to describe a terminal session or line. Users who're using Linux may see a process or user logged in or using a tty such as ttyx, where x is any numerical value. This could be tty1, tty2, tty3, tty4, tty5, tty6, tty7, etc.