These days, the word 'psi' has almost become synonymous with the word 'parapsychology'. But what does it mean?
As well as being derived from the Greek work psyche (meaning "soul" or "mind"), psi is the 23rd letter of the Greek alphabet. In the 1940's, it was proposed by B.P. Weisner and R.H. Thouless that psi be used as a general blanket term to identify anomalous processes and causation. Used as an adjective or noun, psi provides a neutral substitute for terms like extra sensory perception (ESP), psychokinesis (PK), or even the survival of bodily death. Since the term is purely descriptive, it neither implies that such anomalous phenomena are paranormal nor connotes anything about their underlying mechanisms.
Some researchers have come to think that ESP and PK might simply be different aspects of a single process, rather than being distinct and essentially unique phenomena. Sometimes psi is used to reflect this kind of thinking. Others prefer to use psi as a purely descriptive term for anomalous outcomes. In other words, psi can be used to describe the anomalous outcome of a laboratory experiment, without the researcher being required to choose between culturally connotated words like clairvoyance, telepathy, or psychokinesis.
Since the 1940's, the field has embraced this practice, and the usage of the term is widespread. Nowadays you'll find many scholars who refer to themselves as psi researchers, work at psi laboratories, look for psi in their experiments, read psi journals, and go to psi conferences.