What does jail-breaking mean?

Every now an then I hear people jailbreaking their iPhones and android devices, etc
What is it? Is it good or bad? If it's bad, then why isn't it banned?

It means you hack your phone so you can install software not from the apps store or approved by the vendor

Jail-break, is escaping from jail.

You can do a lot more with your phone and customize it more when its jailbroken. But it can also make the battery percentage unstable.