ArDanZ11 Does the internet not know what it is? It's a shading technique that makes 3D look realistic but it's relatively inexpensive to render. It's a simplified form of global illumination that simulates one aspect of it - soft shadows caused by objects on the scene occluding a dominant large-area light source, which is typically the sky or the walls of a room.
It's relatively simple conceptually. Think of it like this. You are an ant walking around the scene on an overcast day. From each point on the scene you can see a different total area of the sky, due to objects on the scene covering it. The more objects covering the sky at your position, the less of the ambient (sky) light is reaching it and the more shadowy it will be. This is called the occlusion shadow. If you walk under a car, you won't see almost any sky. That's why it's always dark under cars. The ambient (sky) occlusion is large there.
Other way to look at it is that it's simply a very soft penumbra (gradual half shadow) of a very large light source (sky)
AO is typically a ray tracing technique but modern engines can approximate it in realtime as a post effect by using the depth buffer. That's why it's called SSAO (screen-space ambient occlusion). It's not as accurate as pre-rendered ray traced version, but can sell the illusion quite well.
I might be a bot after all.