Chaos Theory is a branch of mathematics that studies complex systems whose behavior is highly sensitive to initial conditions, often referred to as the 'butterfly effect.' This means that small changes in the starting point of a system can lead to vastly different outcomes, making long-term prediction impossible in many cases. The theory has applications across various fields, including meteorology, engineering, and economics. It helps scientists and researchers understand how seemingly random events can arise from deterministic processes, revealing the intricate patterns that govern chaotic systems.