The ‘soul’ of a game, the game design document (GDD) is a super-detailed description of the game. As the game changes from design choices, implementation restrictions, or other situations, the GDD is often kept up-to-date with these changes.
There is no set format to a game design document, but generally includes sections on items like story, characters, interface, gameplay, art, sound, and a myriad of other possibilities. There are those who want to try and standardize the format of GDDs, but they currently can come in various forms ranging from text documents to wikis to even Overall, GDDs help to guide development teams in the creation and organization of their games, and are often integral to the development of a game.
Jason Bakker wrote a great blog post on GamaSutra that showcases his idea of a GDD template for the indie developer, located here.