A Horde territory is any area in which Alliance players will find their PvP flags automatically turned on. Any Alliance player can be attacked by a player of the Horde while in these zones. Unlike contested territories, it does not matter whether you have war mode on or not.
All Horde capital cities are considered Horde territory to Alliance players, regardless of the player's current war mode status. With the war mode on, the Horde territory is extended to encompass all Horde starting areas, as well as Northern Barrens, Azshara, Ghostlands (except for the sub-zone Hatchet Hills, which is contested) and Silverpine Forest. Originally, on PvP realms, this meant that Horde players were free to turn their PvP flags on or off in friendly territory whenever they liked, but with the new war mode system implemented, players with war mode on always have their PvP flag turned on, as though they are always in contested territory.
Alliance players will see a notification on their screens when entering Horde territory.