What is a windowing system?

Can someone provide me with a very clear and practical example of a "windowing system"? I was reading on Linux, and although I've always known that it's a kernel, I didn't really know what a kernel is because I haven't taken an OS class yet. My understanding of it is that it's basically the layer between hardware and software. Would that be correct? Now the Linux distros everyone uses is combination of GNU/Linux/X Window System. I think I got the Linux kernel part, but what is a windowing system and what is GNU? Wikipedia says GNU is an OS, but then that would mean Linux distros are composed of another OS. Can someone clear this up for me?