'Difficulty' refers to how much processing power is competing on the bitcoin network to verify transactions. The more machines attached to the network, the higher the processing power (hash rate). The higher the processing power, the faster the network can confirm the transactions. 

Bitcoin and other Proof of Work cryptocurrencies are self-regulating. So the network aims to keep the time it takes to add blocks of transactions to the blockchain to around 10 minutes.

If the network needs to speed things up (low hash rate) it will make a downward difficulty adjustment. If it needs to slow things down (high hash rate), it will make an upwards difficulty adjustment.