Quote wikipedia:
An embedded system is a special-purpose system in which the computer is completely encapsulated by the device it controls. Unlike a general-purpose computer, such as a personal computer, an embedded system performs one or a few pre-defined tasks, usually with very specific requirements. Since the system is dedicated to specific tasks, design engineers can optimize it, reducing the size and cost of the product. Embedded systems are often mass-produced, benefiting from economies of scale.

Personal Digital Assistant or Handheld computers(PDAs) are generally considered embedded devices because of the nature of their hardware design, even though they are more expandable in software terms. This line of definition continues to blur as devices expand.

Physically, embedded systems range from portable devices such as MP3 players, to large stationary installations like traffic lights or factory controllers.