It's a conjunction that introduces a clause that contrasts with the main clause, similar to the English "although".
Here are some examples:
* Aunque hace frío, voy a salir a correr. (Although it's cold, I'm going to go for a run.)
* Aunque no tengo mucho dinero, voy a comprar un libro. (Even though I don't have much money, I'm going to buy a book.)
* Aunque me gusta el chocolate, no lo como mucho. (Despite the fact that I like chocolate, I don't eat it much.)