The Interaction Design Association (IxDA) defines Interaction Design (ID) as the "design of the structure and behavior of interactive systems". According to IxDA, Interaction Designers strive to create meaningful relationships between people and the products and services that they use, from computers to mobile devices to appliances and beyond. Paying particular attention to this aspect of design and codifying the interaction between humans and technology is a fairly recent movement, even within the tech industry.
Interaction Design falls within the broader umbrella of user experience, and honestly, some of those distinctions are still being worked out. We just know that interactivity is the most meaningful distinction between traditional media and new media. The web is not for viewing only. User Experience Design is a higher-level concept which ties together any number of web components, but Interaction Design focuses a bit more specifically on individual media and social objects. Interaction Design understands both the specifics of interface, and how that relates to the larger environment.
Improving experience and usability is the goal of good interaction design.