The Latin phrase Extra Ecclesiam nulla salus means: "Outside the Church there is no salvation". This expression comes from the writings of Saint Cyprian of Carthage, a bishop of the third century. The axiom is often used as short-hand for the doctrine, upheld by both the Eastern Orthodox Church and the Roman Catholic Church, that the Church is absolutely necessary for salvation (cf. "one true faith"). The theological basis for this doctrine is founded on the beliefs that (1) Jesus Christ personally established the one Church; and (2) the Church serves as the means by which the graces won by Christ are communicated to believers.
An Eastern Orthodox bishop has expressed this doctrine as follows: "'Extra Ecclesiam nulla salus. All the categorical strength and point of this aphorism lies in its tautology. Outside the Church there is no salvation, because salvation is the Church' (G. Florovsky, Sobornost: the Catholicity of the Church, in The Church of God, p. 53). Does it therefore follow that anyone who is not visibly within the Church is necessarily damned? Of course not; still less does it follow that everyone who is visibly within the Church is necessarily saved. As Augustine wisely remarked: 'How many sheep there are without, how many wolves within!' (Homilies on John, 45, 12) While there is no division between a 'visible' and an 'invisible Church', yet there may be members of the Church who are not visibly such, but whose membership is known to God alone. If anyone is saved, he must in some sense be a member of the Church; in what sense, we cannot always say."
The Roman Catholic Church also teaches that the doctrine does not mean that everyone who is not visibly within the Church is necessarily damned (see below).
Some of the most pertinent Roman Catholic expressions of this doctrine are: the profession of faith of Pope Innocent III (1208), the profession of faith of the Fourth Lateran Council (1215), the bull Unam sanctam of Pope Boniface VIII (1302), and the profession of faith of the Council of Florence (1442). Whether these expressions constitute dogmatic definitions is the subject of investigation by Catholic theologians. The axiom "No salvation outside the Church" has been frequently repeated over the centuries in different terms by the ordinary magisterium.
-- From Answers.com