A flat file CMS is a Content Management System (CMS) that eschews database connection in favor of simple text files which the system uses to dynamically build web page views as they are visited. Its advantage is speed. Because the system doesn't need to "find" the contents of the page from within a database, server response time is faster and page load times quicker. Well that is in theory, just last week I made some speed tests comparing Flat file CMS's with Joomla CMS and found that although the flat file CMS systems in most part outperformed Joomla, properly optimized Joomla sites with a fast template could outperform a flat file CMS making the decision not so cut and dried.
from Andrew Brett Watson.com