Definition
A mod is a player- or third-party-made modification of a video game, adjusting its content, mechanics or presentation; both the practice and its output are commonly called mods.
How it works
Mods use the editors, tools or open interfaces a game provides to change its assets and logic, ranging from adding an item or tweaking numbers to reworking the gameplay or producing a full “total conversion”.
Usage
Modding communities keep games alive: DOTA began as a custom map for Warcraft III, and many developers treat mod tools as part of their creation ecosystem.
Related and confusable terms
A mod is a modification of a game, while roguelike is a game genre—the two are not on the same dimension; when a game engine ships under an open license such as GPL, distributing its mods must follow those terms as well.