In Python, a class is a blueprint or template for creating objects that encapsulate data and functionality. Classes allow users to define their own data types and create objects that have properties and methods. Objects created from a class are called instances, and each instance has its own set of properties and methods. Classes are used to create complex data structures and to organize code into reusable modules. In Python, classes are defined using the 'class' keyword followed by the class name and the class definition. Understanding classes is fundamental to object-oriented programming and is essential for creating modular and reusable code in Python.