EC2, or Elastic Compute Cloud, is a web service provided by Amazon Web Services (AWS) that allows users to rent virtual servers in the cloud. This service enables businesses and developers to run applications and store data without needing to invest in physical hardware. Users can easily scale their computing resources up or down based on demand, making it a flexible solution for various workloads. With EC2, users can choose from different instance types tailored to specific needs, such as memory, storage, or processing power. It also offers features like automatic scaling, load balancing, and security options, helping users manage their applications efficiently and securely in the cloud environment.