For years, recorded audio was just a signal, captured by a microphone, stored as an audio signal, and then played back by a speaker. The microphone acted as a "proxy" eardrum to hear the sounds when and where the real listener's ear couldn't be. But somebody made an important realization. Most people have more than one ear. So, to proxy accurately, you need two microphones, two stored audio signals, and two speakers, all synchronized in time. The synchronized audio signal involved in one of these mic-storage-speaker combinations is called a channel. A set of synchronized channels is called a stream. Thus was born the idea of multichannel audio.
Nowadays, almost everything you'll find supports multiple channels, even if it's only two. Two-channel audio is known as stereo, and for stereo equipment, the channels are usually labeled 'left' and 'right. Though two-channel is still the norm, three, five, seven, and eight channels are becoming increasingly common for playback. Several companies are even developing array microphones to capture several channels simultaneously.
The problem with multichannel audio is crosstalk. Although the two (or more) channels in a stream are semantically and temporally coupled, you still want the signals to be independent. Crosstalk artifacts occur when the data from one channel leaks into another channel in the same stream. Since channels generally follow the same electrical path (audio chip to rear-panel jack, in a computer), the wires are usually next to eachother. Sound pulses in one channel can cause a corresponding pulse in the other wire through induction. A lot of devices also use the same ground wire for more than one channel. Either of these designs will cause crosstalk.
To the untrained ear, crosstalk can be difficult to detect, since the brain is already used to processing the same data in both ears any time you hear a sound. What crosstalk will do is garble and confuse the spatial (location) information in a stream so you can't tell where the sound is coming from. Crosstalk in surround systems causes an echo effect that can ruin music and make speech unintelligible. It can also add unexpected peaks in your signal, which lead to distortion. Finally, if you think about it, crosstalk can defeat the purpose of having multichannel audio in the first place - playing audio with extreme crosstalk is effectively the same as simply splitting the same monophonic signal into several speakers.
Next time you're listening to your expensive mp3 player with its $2 earbuds, try a little experiment. Dial the balance knob all the way to the right, then stick in just the left earbud. If you hear music, you might want to consider some better headphones.