Traceroute is a network diagnostic tool used to track the path that data packets take from one computer to another over the internet. It works by sending a series of packets with increasing time-to-live (TTL) values, which allows it to identify each hop along the route. Each hop represents a router or device that the data passes through, providing information about the network's structure. By analyzing the response times from each hop, traceroute helps users identify potential bottlenecks or issues in the network. This can be useful for troubleshooting connectivity problems or understanding the performance of a network connection.