Silverlight is Microsoft's answer to Flash
Silverlight is a Microsoft plugin that runs in your browser. This makes it possible to easily display animations, video or audio in a browser. Besides Windows and MacOs, there is also a Linux version available (Moonlight). Microsoft Silverlight includes a portion of the .net Framework and is written in C++ and C#. If it is a replacement of Flash, then why use Silverlight? Silverlight is based on a subset of XAML that makes it easy to create pages (Notepad is basically sufficient). Because it uses XML it would also be easier for search engines to be indexable.
An Introduction to Microsoft Silverlight