A permutation is an arrangement of items in a specific order. For example, if you have three letters: A, B, and C, the different ways you can arrange these letters are ABC, ACB, BAC, BCA, CAB, and CBA. Each unique arrangement is a permutation, and the total number of permutations depends on how many items you have. Permutations are important in various fields, such as mathematics, computer science, and statistics. They help in solving problems related to arrangements and combinations. For instance, when organizing a race, knowing the different ways runners can finish helps in planning and analysis.