An option which can be exercised anytime during its lifespan.

The lifespan is identified as the period of time between the purchase date and the expiration date. The name derives from the fact that most options in the US are of this type, as opposed to European-style options which can only be exercised on the expiration date. This means that the premium for an American option tends to be higher to account for the increased level of flexibility afforded the investor.