Version control in software development serves to manage changes to source code over time. It allows multiple developers to collaborate concurrently without conflicts, ensuring a history of edits that can be tracked and reverted if necessary. The key benefit is that it enhances collaboration among team members, providing a structured way to experiment with new features and maintain the integrity of the main codebase. Popular version control systems like Git enable branching, merging, and conflict resolution, making it an essential tool in modern software projects.