This is a list of terms that appear either in The Sims games or in discussions about the game. This is by no means a complete list, it is a collection of terms that I've seen and verified the meanings for (and had the time to jot down into this list). Add your suggestions in the comments!
Bella was the given name of one of the premade sims that appeared in the original The Sims base game. She was the sister of Michael Bachelor and was married to Mortimer Goth. When The Sims 2 was released, the Goth and Bachelor families were included, but Bella's character was supposedly abducted by aliens and is now missing. Hints and easter eggs have appeared throughout The Sims 2 and The Sims 3 and their related expansion and stuff packs. It is not yet confirmed (as of September 2013) if Bella will appear in any way in The Sims 4.
An acronym for let's play. This term refers to a series of gameplay videos, usually posted to common internet video hosting sites such as YouTube, that show one player's game in progress. The videos usually include play-by-play commentary by the player that is recorded live while the game is played.
Llamas are one type of mascot that has appeared in The Sims games.
A moodlet is sort of a cross between an object and an indicator in The Sims 3.  Moodlets can have negative, neutral or positive effects on a sim's overall mood and will most often relate to actions that are happening at the time that the moodlets appear.  Almost every interaction or in some cases, the presence or absence of objects and/or other sims will cause moodlets to either appear or disappear.  For example, when a sim is in a room with a radio that is playing music, the Enjoying Music moodlet will usually appear in the sim's status panel and give the sim a positive mood boost.  By default, moodlets cannot be directly manipulated by the player, unless there is a mod installed to allow it or the sim has obtained the Moodlet Manager from the lifetime rewards panel.  Although moodlets only affect a sim while the moodlets are present, the effect of moodlets on a sim's overall mood is cumulative.
An acronym for non-playing character. An NPC in The Sims is any sim that is not controlled by the player. See also: townie
A rabbithole is a type of community lot that sims can enter, but instead of allowing the player to see the interior, the sim who enters a rabbithole will stand still one or two steps inside the door then fade away and disappear in order to perform actions that are appropriate for the venue that contains the rabbithole. For example, at the bookstore rabbithole, after the sim disappears into the store, the book purchasing dialog will open allowing the player to select books for the sim to purchase.
route fail
This term describes a condition of a sim's actions where the sim cannot find a way to move to a specific location in the sim world. Sims will generally try to take the shortest path to reach any given location but will end up in a route fail condition if there is something blocking the path.
Simlish is the official language of The Sims. It is a made-up language for use by sims in the game to take the place of real-life language. Using Simlish not only removes the need to translate every vocalization that is spoken by or text that appears to in-game characters, but its use has also been cited as a way to reduce the apparent repetition of common phrases spoken by sims.
A spawner is an invisible asset in sim towns that will generate a collectible object at regular intervals. Spawners can be set to generate common, uncommon or rare collectibles by the town designer, but they can only generate one type of collectible. For example, a gem spawner will not generate an insect or a seed, an insect spawner will not generate a gem or a seed, and a seed spawner will not generate a gem or an insect. Usually, spawners that generate the more uncommon or rare collectibles will be located farther away from sim-populated areas.
sul sul!
(pronounced "sool sool") A common Simlish phrase that roughly translates as a friendly greeting.
A townie is a sim that is not controlled by the player but that also resides in the same town as the player-controlled sim. Since the addition of vacation abilities to other towns and sim worlds, the definition is sometimes expanded to include all non-playable sims in all worlds. See also: NPC
A zombie is a sim in one of the less-normal life states. Zombie sims have appeared in all The Sims games. In The Sims 3, zombies were introduced with the Supernatural expansion pack. They are a class of sims that have a pale green skin tone, and they don't do much besides stand around growling and waving what would be claws at thin air. When normal sims are near zombies for a while, sometimes the zombie will decide to "zombie attack" the normal sim; such an attack could lead to a bite from the zombie sim that will turn the normal sim into a zombie.