Literally means "Chief" in French and has nothing to do with cooking except for the fact that the "Chief of Food" at a restaurant is called the Chef de Cuisine or Chef for short.
Americans do make the mistake of equating a Chef with a Cook, which clearly must piss of any Non-Cooking French Chef...we should therefore keep up the good work.
Also, since a Chef is a "French Chief" and Chief is commonly used as a derisive moniker (a la sport, boss, my friend, jefe, etc), calling someone a Chef can be quite an aggressive insult in certain circles.
Also, a term of the utmost respect depending on context
Chef, nice work picking up that smokin hottie last night. I hope you closed that shit
Chef there is something floating in my water, can I have a clean glass please. On second thought, I don't want this cack'd up tap water, please bring me some bottled, no gas please.