The process of distributing power away from a central point. This can often create more resiliency to a system since the power is not in the hands of a few individuals or entities.
The key for blockchains is to have the code act as the authority, eliminating the need for a centralized intermediaries. This also reduces the level of trust the participants put on one another.
A fundamental piece of this is peer-to-peer (P2P) technology.
Decentralization is also often associated with a horizontal structure as opposed to vertical.
It is also one of the core tenets of Web 3.0.