Open source refers to software where the source code is openly available and can be modified or customized by users. It provides freedoms for users to use, study, share, and improve software. Some key open source projects include Linux, Android, Mozilla Firefox, and OpenOffice. Open source offers advantages like lower costs, interoperability, and customizability while potential disadvantages include lack of warranty and support. Common myths about open source include that it is unreliable, unsupported, and not used by big companies.