A Security Token Service is a software based identity provider responsible for issuing security tokens, especially software tokens, as part of a claims-based identity system.
In a typical usage scenario, a client requests access to a secure software application, often called a relying party. Instead of the application authenticating the client, the client is redirected to an STS. The STS authenticates the client and issues a security token. Finally, the client is redirected back to the relying party presenting the security token. The software application verifies that the token originated from a trusted STS, and then makes authorization decisions accordingly. (-Wikipedia)