Often means the air-dried Chinese kind, sliced and steamed with rice or stir-fried. Besides the sweet Cantonese style there is a spicy Sichuan style with chili and Sichuan pepper, often smoked; Western sausages are sold too.
Chinese sausage (腊肠/香肠) is quite different from Western sausage - it's typically air-dried, sweetened with sugar or rice wine, and has a firm texture. Cantonese-style (广式) sausage is the most famous variety.
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腊肠 is the traditional Chinese dried sausage. 火腿肠 is processed ham sausage, a popular cheap snack in China.