An inline fan is a fan that is mounted further away from the grill and is connected to ducting that is used for extraction purposes. An inline fan does not sit directly on the plasterboard or ceiling, instead it is typically located inside the attic or roof space a little bit further away from the bathroom.
As the fan is located further away in the roof space and not directly above you, the noise levels within the room you are extracting from will be less. They are also more powerful than wall or ceiling mounted fans as they are available in larger sizes with very high power motors. Some models come with a low voltage down light which is perfect for above showering areas.