Case sensitivity refers to the distinction between uppercase and lowercase letters in text. In computing, this means that the string "Apple" is different from "apple." Many programming languages, databases, and file systems treat these variations as separate entities, which can affect how data is processed and retrieved. For example, in a password system, "Password123" and "password123" would be considered two different passwords due to case sensitivity. This feature is important for ensuring accuracy and security in various applications, as it allows for a greater variety of unique identifiers and helps prevent unauthorized access.