A Tax Lien is a tool the IRS uses to collect past due taxes. These liens are filed with the County Clerk in the county where you live (or where your business resides). Once a lien has been filed against you it will show up on your credit report. This could make getting credit very difficult. A Tax Lien can also tie up any property you own. If a Tax Lien is filed against your property you will not be able to sell it or transfer the ownership of the property without having the lien removed.
Essentially, a tax lien gives the IRS the right to seize your property in order to collect on the taxes you owe.