According to Merriam Webster, gamification refers to "the process of adding games or gamelike elements to something (as a task) so as to encourage participation." Probably the most famous and successful application of gamification is the online game FoldIt, which takes advantage of the fact that humans are still better at spacial recognition: an interactive game, complete with rewards, sound effects, and a decent user interface, is used to gather data about folding protein chains. Here is a (very basic) tutorial for the game:

 

Within education, we must be a bit more careful when using the term. Gamification does *not* refer to games with possible educational value, such as Minecraft. Playing commercial games or students designing their own games would be examples of game-based learning rather than gamification. As in the definition above, gamification refers to the deliberate addition of gamelike elements to educational tasks, in order to motivate or encourage students to complete the activities. Games deliberately designed to teach a given topic also fall under this concept.

The appeal is obvious: since so many of us, students or otherwise, spend so much time playing mobile phone games or other video games on a daily basis; since these games are often described as "addictive;" and since video games by their nature lend themselves to personalization and interactive exploration; gamification is currently a popular topic in education. This infographic gives a good illustration of the hype.

A good example of an app designed to do educational heavy lifting, but made more effective/engaging through the use of some basic game elements (reinforcement, adaptation, and hints) is Skritter, which helps learners deal with the massive amount of character memorization necessary to read and write Chinese and Japanese:

As with many of the new trends in online education, good research on the actual results of gamification is hard to come by, and what evidence is available is mixed. Research by Dominguez and colleagues has found that although students improved their practical performance and overall scores, their writing scores were lower than the control group, and they participated less in class. Daniel Pink (Pink, Daniel (2009). Drive: the surprising truth about what motivates us. Riverhead.) has also criticized the approach, since he feels that using extrinsic motivation to help students learn impedes the development of intrinsic motivation for learning, which is important for lifelong education.

Like many buzzwords in education, gamification is likely to be the focus of considerable economic and scholarly interest. The evidence suggests that, by putting in considerable work to design a motivational game, some benefits are possible as part of a larger curriculum. It is not yet clear, however, that gamification is capable of replacing significant parts of a more traditional framework.