Generally refers to a controlled subset of recipients for postings to a mailing list or Usenet group.
In this instance, distribution lists are handy for such things as "for sale" messages or discussions of regional politics. A distribution list helps organize any topic-oriented messages for multiple recipients.
More recently, a distribution list refers to a list of e-mail recipients who are established as a group. This enables you to easily send an e-mail to everyone in the group, without having to type their individual names in the "to" line each time. Both examples are functions of software programs, albeit different ones. The first example is a broader program commonly used on a server, whereas the second example is a function the e-mail program on your local computer.