DDR stands for Double Data Rate which means the memory is able to process information on both the rising and falling of the system clock. Ok thats a bit technical, so think of it like this... older memory was only able to process information coming in one direction. DDR memory is able to process infomation as it comes in and is sent back out out to the system. Potentially doubling the performance.
When buying memory, most retailers list memory using the PCXXXX standard. For example PC2700 is the same as DDR333 memory and PC3200 is also known as DDR400 memory.
The number following the module rating (PCXXXX) refers to the maxium bandwidth supported. The larger the bandwidth number the more information that can be passed along it, thereby increasing performance. As a comparison think about your internet connection speed. The more bandwidth you have, the more data can be sent, resulting in faster web browsing. Same applies to memory.
DDR1 memory is 184pin compatible while DDR2 is 240 pin compatible. A DDR1 system cannot use DDR2 memory or vice versa.
DDR2 has become the memory standard for almost all computers as of 2007. AMD who has long pushed off using DDR2 has finally begun engineering their latest endevors with DDR2 architecture. DDR2 memory is not compatible with DDR3 memory or vice versa.
DDR3 made its debue in 2007. This new memory has reached speeds up to 2133mhz stock and will only likely to climb as time goes by. This memory is slowly becoming the standard starting in 2009 but, still is quite expensive as compared to DDR2. As prices start to drop this memory will slowly filter out DDR2 as the standard choice.