The OUYA gaming console needs an API server to talk to, and this is an API server that runs on the OUYA itself.
Your OUYA still needs an internet connection to fetch the game images and .apk game files when browsing the store and downloading games.
This OUYA API server was written by Christian Weiske. The louyapi code is open source: git.cweiske.de/louyapi.git (github mirror). It was built with the help of the OUYA store API documentation, uses the OUYA game data repository and contains files generated by the stouyapi server (github mirror).