A Mary Sue is a fic where the author injects herself into the story, either as herself or someone who is very similar to the way she looks or acts.
As an example, just read Yvonne's hilarious
The Ultimate Mary Sue .
The male equivalent is Gary Stu or Marty Stu. I've heard it called both. A story I was involved with is a great example of one of these:
Marry in Haste .