Acoustic means unamplified by electronic means. Most instruments possess an amplifier - a resonant chamber in which air vibrates. Acoustic means naturally amplified therefore and playing together acoustically is without further amplification.
This is stretched a little for large venues where acoustic instruments are boosted by a P.A System.
Acoustics is also a challenge in venues. Too much soft furnishing absorbs sound and leaves it flat while hard surfaces provide echos and colour. Generally, hard and echoey is preferred for performance and soft and flat is preferred in the studio for recording. Studios will add effects such as reverberation to mimic the hard and echoey feel of a live venue.