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Isolationism refers to foreign policies that range from military neutrality to nearly complete diplomatic and commercial isolation.
In the modern era, complete isolationism is not practical, since any country which chose to ignore international politics and sever communications completely would leave itself extremely vulnerable. However, there are still some countries which try to remain as "closed" as possible to the outside world. Examples include China during the early part of the Cold War, and North Korea.
One of history's most famous examples of nearly complete isolation is the sakoku or "closed country" policy adopted by the Tokugawa Shogunate in Japan from the seventeenth to nineteenth centuries, when external communications and trade were very limited. Note that the Japanese never used the term "isolationism" to describe their withdrawal from the world. The term sakoku itself is a Japanese translation of a European word meant to describe Japan's closing to the West. This came to an end in the 1850s, with the arrival of American naval ships in Japanese harbours, negotiating an end to Japanese isolation more or less by force and precipitating social upheavals which included rapid industrialisation, the fall of the Shogunate, the restoration of the Emperor, and an era of much more aggressive nationalism.
The United States was under a policy of isolationism from the founding of the republic until its entrance into the First World War. In this context, term describes the American foreign policy of hegemony over the Western Hemishere and insular Pacific while avoiding involvement in the European great power politics. While hardly isolation as such, describing the policy as "non-interventionism" would be even more inaccurate given the frequency of U.S. military intervention across Latin America in the nineteenth century. John Mearsheimer notes that the United States is the only modern state to have ever achieved such regional hegemony. 
In modern American political discourse, the term has become a snarl used by neocon politicians like known terrorist sympathizer (IRA, of course; terrorism only counts if it happens to Americans) Rep. Peter King and neocon journalists like Jennifer Rubin, as well as some leftists, to describe Republicans critical of gunboat diplomacy.
- John J. Mearsheimer, The Tragedy of Great Power Politics (New York: Norton, 2001).
- the policy of the British government under Prime Minister Chamberlain in 1938; see Munich Pact; the U.S. was not a signatory to the Munich Pact.
- For instance, see the June 19, 2011 episode of ABC's This Week With Christiane Amanpour. Will actually used the term "isolationism" and not "American non-interventionism."