The Steam Box, as it's been nicknamed up until now, has been officially revealed to some extent by Valve today. The webpage on Valve's Steam shows off a number of proptype units (the 'Steam Machines'), a brief Q&A, and offers gamers the chance to get their hands on the first prototypes that will ship this year.
The 'Steambox' is not a one-size-fits-all console, instead Valve intend to bring a number of different Steam Machines to market by working with 'multiple partners', but what it most definitely is is Valve bringing Steam to the console market via their own hardware. You'll also be able to build your own computer capable of running the SteamOS if you so wish.
These Steam Machines will be 'completely upgradable and open' and will release sometime next year.