Smithy is an Interface Definition Language (IDL) developed by Amazon for describing APIs in a language and protocol-agnostic format. It enables automatic generation of both client SDKs and server stubs from API definitions, serving as a single source of truth. The tutorial covers defining resources, operations, and services using Smithy syntax, then demonstrates how to use Gradle plugins to generate Java client and server code. Smithy focuses on resource-based APIs and supports various protocols like JSON over HTTP, offering more opinionated structure compared to OpenAPI or RAML while providing flexibility in transport and serialization methods.