"Input sharpening", or "capture sharpening" is a term that is used to refer to the fact that digital cameras have an anti-aliasing filter that removes certain artifacts but somewhat softens an image (don't ask me for details), and so digital images can benefit from a certain amount of low-level sharpening, no matter what the intended output. Different cameras have filters of different "strength" and so some put out images that are "softer" than others, but all of our Canon cameras have this filter put in.
This input or capture sharpening is either put in by the camera if you shoot in jpeg or is often put in by you in a Raw converter when you shoot Raw. Some shooters, though, don't apply sharpening at the Raw level if they intend to sharpen in, say, Photoshop -- they prefer sharpening as part of the fuller process. A lot of us, though, use a Raw processor such as Lightroom or DPP as our main processor, with Raw sharpening as our basic sharpening method until a special need occurs for printing or another required output.
This is where "output sharpening" comes in -- a specific demand for an image can call for special processing, and sharpness is a big consideration. If, say, you want to print an image at 20" x 30", all the detail of that image will be enlarged, and you will likely want to ensure that sharpness of that image is optimized for a large print. If, though, you prepare an image for displaying on the Web, you may want another level of sharpening. Also, different types of images can benefit from different approaches to sharpening that can be considered "output sharpening". Portraits take a special approach to fine tune them, for example. A lot of images benefit from sharpening the central subject while not sharpening the background. These are tasks that may not be done well with a Raw processor, and certainly are not considered if shooting jpeg.
Whether you think and act with different concepts of input processing and output processing, or even throw in intermediate processing is a matter of personal style, but can make a difference to how you approach things.