The significance of plasmids in biotechnology lies in their ability to serve as vector tools for gene transfer. Plasmids are small, circular DNA molecules found in bacteria that can replicate independently. Scientists can manipulate plasmids to carry specific genes of interest, enabling the introduction of those genes into another organism. This technique is fundamental for applications such as genetic engineering, producing genetically modified organisms (GMOs), and developing therapeutic proteins. By harnessing plasmids, researchers can enhance crop traits, produce medications, and conduct vital studies in genetics and molecular biology.