Reference Table


Abbreviation
Meaning
How To
st or sts
Stitch 
or stitches
Counts as one loop on the needle
K or k
Knit
This video shows how to cast on and knit the knit stitch. Once you make a “swatch” of doing plain knitting on each row is called the “Garter Stitch”
P or p
Purl
The purl stitch is different from the knit stitch in that in knitting you keep your yarn at the back of your work. In purling you bring the yarn to the front. Second, in purling you insert your needle in front of the stitch from the right side when in knitting you insert it in the front of the stitch from the left side. This video can explain.
Turn
Turn work 
to the 
other side
Turn work to begin next row. Don’t forget to count which row you are on and count the number of stitches you have when you are done with the row
K2 tog
or k2 tog
Knit two
together
This decreases the number of stitches in the row. You literally insert the right hand needle through two stitches on the left hand needle and knit them together.
P2 tog 
or p2 tog

Purl two
together
Same thing except with two purl stitches.
M1 or m1
Make one
stitch
You will be told whether to make it to the left or to the right. It is usually left. It adds one more stitch in the row. This video is great
S1 or s1
SL 1 or sl 1
Slip one
Transfer stitch from left needle to right without knitting
SSK or ssk
Slip slip knit
Slip one stitch as if to knit and move it to the right needle without knitting. Do the same for the second stitch. Then insert the left needle into the two stitches on the right needle from the front and then knit them together. This video is great
Inc or inc
Increase by one stitch or by one stitch each stitch in the row. The directions will tell you what they mean by “increase”
Usually done when you are ready to start on a new row.  Increasing shapes the garment. Make a knit stitch except do not drop the loop off the left hand needle and then knit once again into the back of the same stitch. When you have knitted twice into the same stitch, then drop that stitch off the left hand needle. Do this as many times as the directions say
Dec or dec
Decrease by one stitch (or it will say more stitches)
The directions will tell you which way to do it. Most times it will be knitting or purling two stitches together normally. Sometimes the abbreviations for “decrease” will be: 
SL 1, K 1, PSSO
PSSO
Pass the
slipped stitch
over the knit
stitch
It is like decreasing one. Usually seen after sl 1, k1
Watch this video by the Knit Witch
YO
Yarn over
Another way to increase the number of stitches in the row. You basically end up making another stitch by moving the yarn over to the front before knitting the next stitch as usual. When you slide the stitch to the right needle you end up moving two over. This video shows you how
Dpns
Double
point
needles
These needles are sharp on both ends for knitting in a round
*
Asterisk
Repeat the instructions following the * as many more times as specified
Rnd
Round
Knit in the round, or knit the rest of the round as directed in the pattern
( directions ) phrase
Parenthesis
Follow directions in the parenthesis according to the phrase following. This means whatever is in included in the (  ) should be repeated the number of times specified directly after
RS
Right side
Front of the piece; the side started as row 1
WS
Wrong side
Back side of the piece

These are just a few that you will need to know as you advance your knitting skills.
About.com has an amazing table that has more abbreviations and definitions than the ones I put above.
Also for further detail:  See my blog on most of the different stitches and ways to join two pieces together.