In microservices architecture, "service mesh" refers to a dedicated infrastructure layer that facilitates communication between microservices. It manages service-to-service interactions, offering features like load balancing, service discovery, and secure communication. With a service mesh, developers can simplify the complexities of managing microservice interactions, allowing for improved monitoring, tracing, and failure handling without adding overhead to the individual services. This separation of concerns enables teams to develop and deploy their services independently while maintaining a cohesive ecosystem.