Passive smoking occurs when you breathe in someone else’s cigarette smoke. Passive smoking is also known as second-hand smoking, involuntary smoking or exposure to environmental tobacco smoke (ETS).

Cigarettes produce three types of smoke:

mainstream smoke - the smoke breathed in through the burning cigarette by the smoker
exhaled mainstream smoke -  the smoke breathed out by the smoker from their lungs
side stream smoke - the smoke which drifts from the end of a lit cigarette

Environmental tobacco smoke (ETS) consists of exhaled mainstream smoke and side stream smoke. 

A wealth of scientific evidence now exists showing that the breathing of tobacco smoke polluted air by non-smokers can lead to serious harm, such as increased bronchitis, pneumonia and other chest illnesses in children, asthma, lung cancer and cardiovascular disease.  This is of course in addition to the well-known irritant effects of tobacco smoke to the eyes, nose, throat and airways passages.

Further Information:
Information Sheet: Passive Smoking
 National Tobacco Campaign Passive Smoking FAQ

References
National Health & Medical Research Council. The health effects of passive smoking: A scientific information paper. Canberra: Australian Government Publishing Service, 1997.