I'm going to reproduce a post on this that I did a while back along with my definition as just a way of setting the stage.
Definition from my first post on TULIP:
Christ's death secures salvation for the elect (those that God has chosen). Those that He died for have their sins forgiven. The word “Limited” refers to the extent of the atonement (Christ's death). If Christ's death secures salvation, then the fact that someone isn't saved means that Christ didn't die for them. (Limited carries a negative connotation, which is unfortunate)
Someone asked me to explain the 5 points of Calvinism today (wahoo!), and as I got to "L" - Limited Atonement they got that little look on their face that said "what? How can that possibly be biblical?" When I say that Limited Atonement basically says that "God didn't send Christ for everyone " immediately the response is, "what? I thought God loved everyone?"
My response in brief:
I guess "limited" emphasizes the wrong aspect that it's really supposed to illustrate. While I would say that God didn't send Christ to die for everyone, the point I would emphasize would not be the "scope" (how many people it's applied to), but rather the "extent" (how much the death accomplishes). The point of saying that God didn't send Christ to die for everyone is to finish that statement with a positive one: Those that Christ died for are saved. Completely and irrevocably. Christ's death secures the salvation of those He died for. There isn't anything else that a person must do. The death of Christ upon the cross completely covers and removes all sin from a person and places Christ's perfect righteousness upon that person.
Thus a "Calvinist" limits Christ's death in one way (who Christ dies for), but has a much bigger picture of what Christ's death accomplishes: the salvation of each and every single one of those that God has chosen. A "synergist" removes the limit on Christ's death in one way, saying that Christ died for everyone, but places that limit on another aspect: Christ's death is only sufficient to save those who have faith.
Yeah, "Limited Atonement" maybe could be replaced with "Definite Atonement" to clear up the confusion, but TUDIP doesn't quite sound so good as a TULIP =)