Is a disk partition or file used to temporarily store the inactive contents of memory (RAM).
Storing inactive bits of memory to disk frees up memory resources for higher priority tasks.
While swap space can improve performance in most systems this is not likely to be the case with regards to the Pi, because of the slow response times (compared to RAM) of the SD Card or an external hard drive. In addition enabling swap on an SD Card could lead to premature failure of the SD Card.
Common questions
How do I create a swap partition?