The wordpress developers call it distraction-free writing or zen mode.

It’s what a couple of simple plain text editors have done on the desktop for years. Besides a couple of important features, this is the new cool thing in WordPress 3.2 codename Gershwin. So for everybody who wonders what it looks like, here it goes:

Zen writing with interface on top which appears when the mouse is moved to the top.

Zen writing with no interface, just for typing.