The labia (which is Latin for lips) are considered part of external genitalia, the parts you can see. The labia protect the vaginal opening and are also rich with nerve endings, making them a site of pleasure for some.
There are two sets of labia, the outer labia (labia majora) which are visible without spreading the legs wide open, and the inner labia (labia minora) which are only visible when the legs are spread open.
Calling the outer labia majora is a bit misleading since they are often smaller than the inner labia. But we're stuck with the Latin we've got.
The outer labia are thicker, with rougher skin, and often have hair on them. They are part of the vulva and appear as sort of a fold of skin. In between them are the inner labia which are thinner, softer skin, and more flexible.
The inner labia come together at the top of the vulva to form the clitoral hood and as such when they are stimulated they often indirectly stimulate the clitoris.
The inner labia are often longer or seem to stick out more than the outer labia. They usually don't have hair on them, and they can change both in shape and color when stimulated.
In a response to the proliferation of pornography several books and websites have been created that offer people a chance to look at the diversity among labia in a non-pornographic context. Online sites include The Labia Library, run by Women's Health Victoria.