From The Aquarium Wiki
What is it?
A biotope is a tank that is set up to simulate accurately the original environment of the animal as much as possible. This is includes the type of plants (if any), snails, companion fish, other life and substrate, rocks. As well as water parameters like pH, GH, KH, temperature, etc.
Why do this?
The aid is to show how the animal would look if in the wild and by setting up their natural environment as accurate as possible you keep the animal healthy and may get the animals breeding.
Few people can simulate a biotope 100%. Often rules are bend or broken depending on the seriousness of the aquarist in their quest. For example it may be hard to impossible to obtain the exact plant species or the correct type of rock found in their environment. We often make do with what we can obtain.