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geostrophic literally means earth-turning. The geostrophic approximation is to ignore all forces other the balance between the Coriolis force and the pressure gradient force. This is a very good approximation for the synoptic scale instantaneous flow in the mid-troposphere where friction is not important - ie away from the surface. However, although non-geostrophic terms are relatively small they are important for the time-evolution of the flow.
The geostrophic wind <math>(u_g,v_g)<math> is that calculated by the geostrophic approximation:
where g is the force of gravity (9.81 m/s^2), f is the Coriolis parameter (approximately 1e-4; varies with latitude) and Z is the geopotential height field. The approximation is formally invalid at the equator where f is zero, and not good within, say, 10 degrees of the equator where f is small.
Other variants of the equation are possible, for example, using the pressure field instead of Z, but are slightly more complex.