I take it you only know the meaning that the west and those who are ignorant have appled to it (that of holy war)?
An unfortunate one these days, but keep in mind that traditionally the concept of Jihad is holy war in the sense of an internal struggle, like speaking truth to power, or protecting people that can't protect themselves. You know, aiming to be a better person and all that. Not a Muslim but that's been my experience with that particular word.
You're on the right track but not quite. Jihad doesn't mean holy war at all. It's a meaning that was applied to it recently, because it's a catchy lable and makes for great propoganda.
You can read the meaning of Jihad here, if you wish.
Jihad means to strive, to struggle. Usually it is applied to inner struggle: for example, to fight your inner weaknesses or if you're studying for an exam, you would be doing jihad. It also applies to war, in the sense that if you're fighting for your country to protect against an enemy, you're doing jihad because you're striving, struggling.
The concept of Holy War actually comes from the western crusaders who used it to justify their invasion of palestine. The word for Holy War or it's concept isn't mentioned in the Quran. It's funny to see it's application reversed.
It's rather annoying to see jihad being mispresented, especially since a little research would give you the correct meaning of the word. But, we can see, it serves a particular purpose because after all, it's easier to twist thingsa and not have to think about it.