aapt stands for Android Asset Packaging Tool and is included in the tools/ directory of the SDK. This tool allows you to view, create, and update Zip-compatible archives (zip, jar, apk). It can also compile resources into binary assets.
Though you probably won't often use aapt directly, build scripts and IDE plugins can utilize this tool to package the apk file that constitutes an Android application.
For more usage details, open a terminal, go to the tools/ directory, and run the command:
Linux or Mac OS X:
./aapt
Windows:
aapt.exe