"Red Hat Enterprise Linux (RHEL) is a Linux-based operating system from Red Hat designed for businesses. RHEL can work on desktops, on servers, in hypervisors or in the cloud. Red Hat and its community-supported counterpart, Fedora, are among the most widely used Linux distributions in the world.
Red Hat Enterprise Linux has multiple variants, with server versions for x86, x86-64, PowerPC, Itanium and IBM System z. It also includes desktop versions for x86 and x86-64. As of November, 2011, the latest variant of RHEL is RHEL 6.
Being a Linux distribution, Red Hat Enterprise Linux contains the Linux kernel as well as some applications for performing certain tasks. Like all Linux distributions, RHEL is open source. Thus, people can view its source code, download it and make their own customized versions.
Some of the notable Linux distros that are actually derived from RHEL include CentOS, Oracle Enterprise Linux, Scientific Linux and Pie Box Enterprise Linux.
In the past, Red Hat gave this enterprise product for free and only charged for support. Later on, they decided to create two versions: RHEL, which would have less frequent version releases and consequently be more stable, and Fedora, which would undergo relatively more frequent version releases and consequently offer more bleeding edge technologies.
Fedora, which is given entirely for free, is sponsored by Red Hat (the company) but is actively developed by a community of developers. It is most suitable for Linux enthusiasts. RHEL, on the other hand, takes technologies developed via the Fedora Project and packages them into a more reliable and stable commercial product. Hence, RHEL is best suited for the enterprise.
People who subscribe to RHEL can download the installer for free but have to pay for support. Special editions of RHEL are available for academic institutions who are willing to pay a smaller fee to use the relatively more stable RHEL rather than a Fedora.