The operating system is generally the biggest software running on a computer or other piece of technology.
The operating system contains the functions to drive the pieces of the system, such as the video card and monitor, the sound processor, and basic input/output.
Some operating systems, like Mac OS are closed systems that can only run on a very small selection of hardware, while an operating system such as Windows is made to be compatible with every piece of hardware imaginable, though even that is generally limited to how much effort the manufacturer puts into making working driver software. Linux distros vary in compatibility, though they are getting much better at supporting hardware. Linux does tend to lack adequate drivers for most hardware that the average user needs, specifically GPU related drivers - this can generally be blamed on the manufacturers themselves.
In the days before the modern operating system, software would run from a simple command line, often needing its own code for driving a graphical user interface, or to play simple sounds. With the introduction of the modern graphical operating system, the command line is mostly a thing of the past, and software runs from a desktop, instead of being scattered around your hard drive or random disks.