What does the term "overfitting" refer to in machine learning?

The term "overfitting" in machine learning refers to a situation where a model is overly complex and captures not only the underlying patterns in the training data but also the noise. This excessive complexity leads to poor performance when the model is applied to new, unseen data because it essentially memorizes the training data instead of generalizing from it.

This means that while the model may show excellent performance metrics on the training set, it fails to predict accurately on data it hasn't encountered before, indicating a lack of generalization ability. Overfitting is essentially a trade-off between model complexity and its ability to generalize. Thus, an appropriately simple model might miss certain trends, while an overly complex model narrows its focus too much, resulting in poor real-world applicability.