Account Sharing is when a person allows one or more other people to log in as them and play as their character(s). By doing this, their character can be online virtually all of the time, resulting in quickly gaining high levels from hunting and training (within the restrictions of the character's Stamina). On the other hand, account sharing can be simply be seen when someone discloses their account information to someone else, openly. According to the Tibia Rules, only the one who created the account should know the account information.
Account sharing is against the Tibia Rules, and if you're caught you'll get a thirty day Account Banishment and a deletion warning (sometimes an instant deletion even without criminal record). Not only is it against the rules it is also very risky since it can get your account hacked.
Before the Christmas Update 2003 account sharing wasn't forbidden, it was just not supported. But due to more players finding Tibia and sharing reached new highs they had to forbid it. Before this change it was pretty common that two players shared their account, but it didn't mean they where high levels because the power gaming enviroment back then was very different from today.