It's an inert gas, the decay product of uranium in the soil. We try to seal houses up for energy efficiency. That creates a vacuum that sucks up radon from below and into the living area. Radon decays into radioactive particles. These particles are inhaled and cause lung damage, including lung cancer.
Radon is second to smoking as a cause of lung cancer.
Its effect is cumulative it won't kill you now, but will do so after 30 years of exposure. The more time you spend at home the greater the exposure. If a house tests over that level, then action should be taken. You can't test the soil before building. At the Health Department, we gave out some radon kits last year to get some information back about where we have radon problems.