A method of transferring data by breaking it up into small chunks called packets. Packet data is how most data travels over the Internet, and, in recent years, over cell phone networks as well.
With packet-switched data, each user only consumes network resources when they are actually transferring data. This is often superior to circuit-switched data, where an open data connection must be maintained, which uses network resources even when idle (like standard voice connections.)
Packet-switched is the more modern type, and usually faster.
In a mobile phone, data is used for functions involving the Internet, as well as most kinds of streaming video and audio.
There are many different types of packet data for mobile phones, with different maximum speeds.