An acrostic is a poem (or other type of writing) in which the first letter of each line (or other recurring element) spells something out.
So, for this game, we'll be making acrostics using names. For instance, we might start out with an acrostic for Sue:
Sarah
Ursula
Eva
And then the next person would choose one of those names (let's say Eva) and make an acrostic out of that name:
Elena
Veronica
Anne
...and so forth. Easy, right? Ok, so the first name is Rhonda, and here is my acrostic:
Rita
Hannah
Orlagh
Nancy
Diane
Annabeth