Java is a programing language.
It is installed mainly for viewing webpages. Sites that commonly use it are online chat rooms. Other sites can use it to brighten their content so you may be missing out on your favourite sites.
Java or rather the stuff you would want to be installing is produced by Sun Microsystems.
Not really any risk in having it as most people have it. Also most people have reasonably good precautions against viruses so as long as you are just as careful as ever it will cause no problems.