Cosplay is a short form of "Costume play" and it deals with dressing up as a fictional character mostly but not limited to Japanese games, anime and manga.
Cosplayer /Layer are terms for people who do cosplay
Cosplay Conventions are gatherings for competitions, stores and booths that have goods and products related to but not limited to Japanese games, anime and manga.
Top 3 Misconceptions:
Attractiveness is required and chosen
While we do have an administering body for conventions and such, no one has a say who has a right to cosplay (Except your parents... Learn to listen to them!!). Again, similar to drawing, gaming and reading books, if you can afford it or have a way to access materials needed for it (renting a costume, buying it or making it) and YOU want to do it.
head on to your nearest convention or photoshoot with friends
and JUST DO IT! : )