Test Driven Development (TDD) is a software development approach where tests are written before the actual code. Developers first create a test that defines a desired function or improvement, then write the minimum amount of code necessary to pass that test. This process helps ensure that the code meets its requirements from the start. Once the test passes, developers can refactor the code for optimization while keeping the tests in place to verify that the functionality remains intact. TDD promotes better design, reduces bugs, and enhances code quality, making it a valuable practice in modern software engineering.