A dominated strategy in game theory refers to a strategy that results in a worse outcome for a player, regardless of what the other players choose. In other words, if there is another strategy available that always yields a better payoff, the dominated strategy is considered inferior and should not be chosen. Players aim to maximize their outcomes, so identifying dominated strategies helps simplify decision-making. By eliminating these less favorable options, players can focus on strategies that are more likely to lead to better results in competitive situations, such as in games involving Nash Equilibrium or Prisoner's Dilemma.