A DLL, or Dynamic Link Library, is a file format used in Microsoft Windows operating systems that contains code and data that multiple programs can use simultaneously. This allows for efficient memory usage and modular programming, as developers can create shared libraries of functions that different applications can call upon without needing to include the same code in each program. When a program runs, it can load a DLL into memory, allowing it to access the functions and resources defined within that library. This not only saves disk space but also makes it easier to update and maintain software, as changes to a DLL can benefit all programs that use it.