Every year, Congress must pass bills that appropriate money for all government spending. Generally, one bill is passed for each department of the executive branch (each department is headed by a member of the President's cabinet. Ordinarily, each bill is passed separately — one bill for the Department of Defense, one for the Department of Commerce, and so on.
When Congress does not or cannot produce separate bills in a timely fashion (by the beginning of the fiscal year in October), it will roll many of the separate appropriations bills into one omnibus spending bill. Some of the reasons that Congress might not complete all the separate bills include partisan disagreement, disagreement amongst members of the same political party, and too much work on other bills.
Oftentimes, omnibus spending bills are criticized for being full of pork (unnecessary/wasteful spending that pleases constituents). The bills regularly stretch to more than 1,000 pages long, and often haven't even been read in full by the people voting for them. Nevertheless, they have grown more common in recent years. The most recent one is for fiscal year 2004.