In simple terms it is water colours with opaque (non-see-through) pigmentation. Gouache is also known as ‘body colour’ though no one knows exactly why. The pigments or particles of colour are bound together with glue. Lighter tones are achieved not by adding water (as one might do with water colours) but by adding white.
A few Dada artists have been exponents of the use of gouache as an ingredient in their collages (cf Raoul Hausmann (1886-1971). The Cuban naturalised Chines artist Wilfredo Lam (1902-1982) used Gouache as preferred medium in much of his production.
Gouache is quite a versatile medium and can be used almost as oil painting. However it has the sad side effect of drying up a few shades lighter than the wet paint. Thus the use of Gouache has been in decline since the invention of modern acrylics. Modern acrylics can span the whole spectrum of being used almost as water colours and semi transparent with matt medium, and it can be applied thick and impasto like oils; and it can be applied acrylic retarder so as to delay the drying time significantly to mimic some inherent advantages in oil paint. Furthermore, wet and dry acrylic paint do not differ in hue or shade the way gouache does.