Stream Out is a feature formally introduced with DirectX 10.0 hardware and it provides support for storing primitives in a buffer with the data being output directly from a Geometry/Vertex Shader before the rasterization stage. Data can be (optionally) copied back to the CPU then for reading back. This is also known as a transform feedback in OpenGL. A few more technical details can be found in the Gallium3D documentation. A few technical bits on the OpenGL transform feedback mode can be found on this NVIDIA developer page.
Zack's comical announcement of this Stream Out support for Gallium3D can be found in this mailing list thread. Look for it to be merged to master soon for Mesa 7.9. The individual Gallium3D hardware drivers, however, still need to implement the actual capabilities on supported graphics processors.