The term "latency" in networking refers to the time delay experienced in data transmission across a network. It measures the time taken for a packet of data to travel from its source to its destination and is influenced by factors such as propagation delay, processing delay, and queuing delay. High latency can lead to performance issues, especially in real-time applications like gaming and video conferencing. Minimizing latency is crucial for ensuring a smooth user experience. Understanding and managing latency helps network administrators optimize performance and improve overall network efficiency.