According to the Reactive Extensions home page:
The Reactive Extensions (Rx) is a library for composing asynchronous and event-based programs using observable sequences and LINQ-style query operators.
This doesn't make a lot of sense unless you know what an Observable sequence is. In most cases to process a collection you iterate over the collection which is generally assumed complete. An Observable sequence isn't necessarily complete when you start processing its collection and to cope with this the Observable will call a processing method each time there is some data to process. This creates an asynchronous iteration which generally runs on a separate thread.
Using Rx, developers represent asynchronous data streams with Observables, query asynchronous data streams using LINQ operators, and parametrize the concurrency in the asynchronous data streams using Schedulers.
Simply put, Rx = Observables + LINQ + Schedulers.
Whether you are authoring a traditional desktop or web-based application, you have to deal with asynchronous and event-based programming from time to time. Desktop applications have I/O operations and computationally expensive tasks that might take a long time to complete and potentially block other active threads. Furthermore, handling exceptions, cancellation, and synchronization is difficult and error-prone.
Using Rx, you can represent multiple asynchronous data streams (that come from diverse sources, e.g., stock quote, tweets, computer events, web service requests, etc.), and subscribe to the event stream using the IObserver<T> interface. The IObservable<T> interface notifies the subscribed IObserver<T> interface whenever an event occurs.
Because observable sequences are data streams, you can query them using standard LINQ query operators implemented by the Observable type. Thus you can filter, project, aggregate, compose and perform time-based operations on multiple events easily by using these static LINQ operators. In addition, there are a number of other reactive stream specific operators that allow powerful queries to be written. Cancellation, exceptions, and synchronization are also handled gracefully by using the extension methods provided by Rx.
In addition a post in the Rx Forum from Bart de Smet, one of th Rx team and author of C# 4.0 Unleashed (see I Programmer's review), shares the news that Interactive Extensions (Ix) is also back as a separate download:
We've focused on restoring the functionality most people care about, eliminated a number of operators that we weren't that fond of (e.g. the *Enumerable aggregates), restored parity with Rx where appropriate, and added support for IQueryable<T> through the QueryableEx type in System.Interactive.Providers. In addition, there are more and better XML doc comments.