The following is an article that I found in The Skeptics Dictionary at http://skepdic.com, a site that I think is very good - I hope you all enjoy it.
Ch'i or qi (pronounced "chee" and henceforth spelled "chi") is the Chinese word used to describe "the natural energy of the Universe." This energy, though called "natural," is spiritual or supernatural, and is part of a metaphysical, not an empirical, belief system. Chi is thought to permeate all things, including the human body. Such metaphysical systems are generally referred to as types of vitalism. One of the key concepts related to chi is the concept of harmony. Trouble, whether in the universe or in the body, is a function of disharmony, of things being out of balance and in need of restoration to equilibrium.
Proponents claim to prove the existence and power of chi by healing people with acupuncture or chi kung (qi gong), by doing magic tricks such as breaking a chopstick with the edge of a piece of paper or resuscitating a "dead" fly, or by martial arts stunts like breaking a brick with a bare hand or foot. When examined under controlled conditions, however, the seemingly paranormal or supernatural feats of masters of chi turn out to be quite ordinary feats of magic, deception, or natural powers.
Vitalism is a popular philosophy in many cultures. Thus, chi has many counterparts: prana (India and therapeutic touch), ki (Japan); Wilhelm Reich's orgone, Mesmer's animal magnetism, Bergson's élan vital (vital force), to name just a few. The concept is very popular among New Age thinking, where it generally goes by the name of energy, though the concept bears no resemblance to the concept as used by physicists.
See related entries on the I Ching, feng shui, koro, and yin/yang.