Serverless computing is a cloud service model where the cloud provider dynamically manages the allocation of server resources. This model allows developers to build and deploy applications without needing to manage server infrastructure explicitly. Instead, they can focus on writing code while the cloud provider handles scaling, performance, and availability concerns. Serverless architecture is often billed based on actual usage rather than pre-allocated resources, leading to cost efficiency. Overall, serverless computing streamlines development processes, fosters agility, and enables rapid deployment of applications.