What wikipedia says about widget is:

"In computing, the term has become frequently used to refer to objects on a computer screen the user interacts with:

Widget engine, a software system for running applets on the web, desktop or mobile phone
GUI widget, a component of a graphical user interface with which a user interacts
Widget toolkit, a software library containing a collection of GUI widgets that collaborate when used in the construction of applications
Web widget, a physically-inspired applet on the web"

But in real terms I think it is like some google gadgets which are frequently used on our website/blogs.