smali/baksmali is an assembler/disassembler for the dex format used by dalvik, Android’s Java VM implementation. The syntax is loosely based on Jasmin’s/dedexer’s syntax, and supports the full functionality of the dex format (annotations, debug info, line info, etc.)
The names "smali" and "baksmali" are the Icelandic equivalents of "assembler" and "disassembler" respectively. Why Icelandic you ask? Because dalvik was named for an Icelandic fishing village.