On many occasions, I have read, or heard of it being explained simply as: "a fortunate accident." I must voice my objections, on grounds that this exemplifies one of my pet peeve: Over-simplification. Specifically, it is missing a main point. The absolutely simplest explanation I'll accept is: "fortunate discoveries by accident."  The difference made by adding back the 2 trimmed words is subtle but significant.

A bit of historical background: Serendip is the old Arabic name of a nation, which was later changed to Ceylon (of tea fame, if you're a connoisseur), and subsequently changed again to Sri Lanka, which is the current name.

The word serendipity was coined by an English writer Horace Walpole in the mid 1700s. It's an allusion to something the author once read―a fairy tale entitled: The Three Princes of Serendip. In that story, the 3 princes of Serendip embarked on a major expedition in a quest of some sort. As it turned out, they made numerous discoveries along the way, purely by accident. These were all unexpected things that were not in the original quest.

So, serendipity means the act or instance of such discoveries. Notice the emphasis is on the word discovery, not the word accident! It's essentially an unintended/unexpected discovery ―a bonus. It could also be referring to the unplanned manner in which good things occurred.

Many people who know this word learnt it from the Hollywood movie with a namesake title, starring Kate Beckinsale and John Cusack. The movie itself is classically mediocre from the artistic point of view, as is often the case with the genre of romantic comedy. The only redeeming value there is that Beckinsale (a beautiful British actress) is in it. Even for Cusack fans, he doesn't look/act particularly well in this one.

[I was just told by a friend that there's an animated film called Serendipity The Pink Dragon (1990). It's of Japanese origin, dubbed in English, and is available in VHS only.]

Serendipity occurs constantly in everyday life. Those more intellectual and treasure life more tend to consciously recognize each occurrence. Ironically (though not surprisingly), knowing this word actually serves to heighten that awareness, which in-turn leads to better appreciation of life, and all that it (the better appreciation) implies.

You have just experienced an instance of serendipity!