Size of the sensor. If you think of it in terms of traditional film camera. It would be the equivalent of the negative. Where 35mm film is 24mmx36mm, Medium format is 2-1/4".
It is easy to get fooled in the digital world. For example an 8MP sensor in a Camera phone is much smaller than an 8MP sensor in a Point & Shoot Camera, and that same 8MP sensor in a Digital SLR would be much bigger. Holding more information.
Hope that doesn't confuse the matter any further.