True means that it is radially and laterally true. As you spin the wheel, it doesn't move side to side (looking from above the tire) and it doesn't move in and out (radially) getting farther and closer to the hub.

On top of this, there is dish. Dish is whether the rim is centered over the hub. Wheel's can be correct and not centered, depending on the application. Rear wheels are often dished towards the drive side for various reasons.

A wheel can be "true" but not dished correctly, depending on who you talk to.