To kite means to run away with the aim of avoiding damage. Also called 'kiting' or 'kitting', kiting is not to be confused with simply just running - those fleeing from battle and not contributing are not kiting.
The term may originate with the acronym KIT, meaning 'killed in transit', although it is now frequently associated with the concept of a kite with an object trailing behind you on a line (in this case a mob being the kite, while the line takes the form of a ranged or magical attack). The term is a carryover from the terminology of other MMORPGs. 'Kiting' in these other games describe hit and run tactics; it has since evolved to the current Guild Wars behavior of 'act and run'.
Effective Kiting
Effective kiting is dependent on skill recognition as well as recognition of profession limitations. Against warriors, spellcasters can be expected to run. However, a more effective means of kiting would be to sidestep (strafe) just outside the range of the weapon, as fleeing is a special designation that increase the likelihood of critical hits.
In addition, effective kiting also requires recognition of the ranges of skills appearing in the skill monitor and the requisite actions to avoid the range of effects, such as the range of PBAoE skills and skills like Earthquake and Chain Lightning.