An in-kernel web server is an unlimited HTTP server that runs in kernel space or equivalent. It is also known as "accelerator".
Benefits
Performance: the path taken by data from a source device (i.e. a disk) to a destination device (i.e. a NIC). Proper asynchronous zero-copy interfaces would make this available from user-space. Scalability: with respect to number of simultaneous clients. Event notification of comparable scalability seems unlikely in user-space.
Drawbacks
Security: Kernel processes run with unlimited privileges. Portability. Every kernel needs a specific implementation route. Reliability. Failure in the webserver may crash the OS.
Implementations
illumos/Solaris: NCAkmod aka Network Cache and Accelerator (NCA) kernel module HP-UX: NSAhttp (NSA is an acronym for Network Server Accelerator) Linux: TUX Mesibo In-kernel real-time messaging server Windows NT: http.sys (part of IIS) SPIN: http OpenVMS: WASD.trap
See also Comparison of web server software Service-oriented architecture Unikernel/Exokernel (eg. SPIN's loadable kernel modules)
References
CITI_TR_00-4 High-Performance Memory-Based Web Servers: Kernel and User-Space Performance. Philippe Joubert, Robert B. King, Rich Neves, Mark Russinovich, John M. Tracey. IBM. T. J. Watson Research Center