Diffie-Hellman is a method used in cryptography to securely exchange keys over a public channel. It allows two parties to create a shared secret that can be used for encrypted communication, even if they have never met before. The process involves each party selecting a private number and using it to compute a public value, which they then share. Once both parties have exchanged their public values, they can each use their private number and the other party's public value to compute the same shared secret. This way, even if someone intercepts the public values, they cannot easily determine the shared secret.