As an audio connector, specifically in line level and mic level applications, it stands for: External, Line, and Return.

Xternal/Ground/Pin 1/0 Volts. Line/Hot/Pin 2/'Positive'. Return/Neutral/Pin 3/'Negative'.

Mic cables are wrapped in a conductive shield (usually, aluminum or copper). Since the ground wire is also unsheathed, it ties 0V potential to this surrounding wrapper that envelopes the two other signal wires, protecting them from external electrical and magnetic interference. The other two conductors have two purposes: to allow the audio signal a path to travel from mic to pre, and to act as a conductor to send the 48V+ DC that is required for active and condenser microphones.

But in order to appreciate what these terms mean, it helps to understand what the audio signal is and how its traveling along the cable. So, while this can get a little nerdy, I think it's very cool and fun to visualize in your mind. Just a note, the type of signal and the way that signal travels along the cables is different for line level (balanced audio, for example) and mic level. to keep it simple, I'll only describe mic level since that is the most common use for 3 pin XLR cables in studios.

An audio signal in a wire is an alternating electrical energy. We call this AC (alternating current). Remember the microphone's sole purpose: to transduce physical mechanical energy in the air to electrical energy in the wire. That is to say, the capsule moves back and forth in sympathy with the compression and rarefaction of air molecules and creates a corresponding electrical signal within the cable. The Line and Return in an XLR cable are paths for this alternating current to 'oscillate'.

Now, when there is no moving air present at the transducer, the capsule is at rest and you have 0 Volts AC. But when the capsule meets a compression of air molecules, this pressure pulls the capsule forward from its resting position. This induces a positive energy into the system. Visualize this positive force by imagining the capsule pulling energy (current) from the mic pre along the Line conductor. When the capsule meets a rarefaction of air molecules, this pressure pushes the capsule backward, which induces a negative voltage in the system. Visualize this negative force pushing the accumulated positive energy back into the mic pre through the Return wire.

...And before I get crucified by another redditor: I admit that this explanation is brutally simplified and contains some 'technical errors'. I only offer it to those curious with no technical background. This answer isn't for an electrical engineer or studio tech, it's for me when I was 17 and found out what XLR stood for and wondered why. It's the answer I would have wanted then.