Characteristic impedance is a property of a transmission line that describes how much resistance the line offers to the flow of electrical signals. It is determined by the physical characteristics of the line, including its inductance and capacitance per unit length. This impedance is crucial for ensuring that signals are transmitted efficiently without reflections. When a transmission line is terminated with a load that matches its characteristic impedance, maximum power transfer occurs, and signal integrity is maintained. Mismatched impedances can lead to signal loss and distortion, making it essential in applications like telecommunications and broadcasting.