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Yes, that was the official language of Yugoslavia prior to its collapse in the early 1990s (along with Slovenian and Macedonian, which are very different). In Serbia they called it Serbo-Croatian and in Croatia they called it Croato-Serbian.
Some of the words are different and those that are the same sound a little softer in Croatian. For example, children is 'deca' in Serbian and 'djeca' in Croatian. Serbs (who are Orthodox) normally used Cyrillic alphabet, while Croats (who are Catholic) used Latin.
After the separation, there was an effort on both sides (especially in Croatia) to make the languages more different, so they started bringing back archaic words or coining new ones. For example, airplane used to be 'avion' in both languages, but in the 1990s the Croats came up with a new word 'zrakoplov' which literally means 'air-floater'.
They are similar, but more different from each other than Serbian and Croatian. I'm fluent in Slovak and understand Czech, but I can't speak the latter. There are too many words which are completely different.
But, all of those are Slavic languages, so it helps being familiar with all of them. For example, a word in Czech may be completely different from Slovak, but I might be familiar with it from Croatian. For example, December is 'December' in Slovak and 'Decembar' in Serbian, but they call it 'Prosinec' in Czech and 'Prosinac' in Croatian.
The process began in 1990 with the introduction of democracy and multi-party system (as opposed to having only one political party, the communist party, until 1989).
There were 6 republics of Yugoslavia (Serbia, Croatia, Bosnia, Macedonia, Slovenia and Montenegro) grouped together as a communist federation - a somewhat artificial country created after World War I. I loved growing up in it in the 1980s. Unlike the other communist countries it had open borders, we could freely travel abroad, learn English, buy western products, watch American & British TV shows and movies, etc.
They all held first democratic elections in the course of 1990. Though the communist party was defeated everywhere, the new parties including the winning parties were made up of former communists now singing a different tune, with nationalist undertones.
Croatia and Slovenia were especially vocal about separating from Yugoslavia and 'going to Europe', while Serbia wanted to preserve the old Yugoslavia in which it had a dominating role (the capital of Yugoslavia was Belgrade, today's capital of Serbia).
So, the nationalist tensions gradually escalated into an armed conflict in the course of 1991/1992, which became especially brutal in Bosnia (because you have all 3 nations/religions there - Orthodox Serbs, Catholic Croats and Muslim Bosnians).
The basis for the war was this - Serbia said to Bosnia and Croatia: OK you can leave Yugoslavia, but we're taking portions of Croatia and Bosnia where the majority of the population is Serbian, and the Croats and Bosnians said: over our dead bodies.
It all ended in 1995 with a peace agreement signed in Dayton, US, but the economic consequences of the war are in my opinion felt to this day. Serbia and Montenegro tried to keep a mini-Yugoslavia alive, but they also went separate ways 15 years ago.
Yes, unlike the violent separation of Yugoslavia (the 'wild Balkans' as my Slovak mother used to call it), Czechoslovakia separated in a very peaceful and civil manner with a formal decree on January 1, 1993.
Even the November 1989 revolution that brought down communism was very peaceful - you had masses of people with lit candles on the main squares demanding that the communists step down - and they did. Of course, this was also because they saw what was happening elsewhere in Europe, the jig was up.
