HTML heading 3, represented by the `<h3>` tag, is used to define the third level of headings in a webpage. It is part of a hierarchy of headings, which includes `<h1>` for the main title and `<h2>` for subheadings. The `<h3>` tag helps organize content, making it easier for users and search engines to understand the structure of the information presented. Headings in HTML are important for accessibility and SEO. Using `<h3>` appropriately can improve the readability of a webpage and assist screen readers in navigating the content. Additionally, search engines like Google use headings to determine the relevance of the content, which can impact search engine optimization (SEO) rankings.