A mathematical function that measures how wrong the model's predictions are. Training aims to minimise the loss. Different tasks use different loss functions: Mean Squared Error for regression, Cross-Entropy for classification, and many others.
If a model predicts a house costs 200,000 but the true price is 250,000, the MSE loss for that prediction is (200,000 - 250,000)^2 = 2,500,000,000. The model then adjusts weights to reduce this value.