A TV panel uses LEDs (light-emitting diodes) to backlight the picture. The problem with this is that if the light behind the screen is too bright, it can wash out the picture. Inversely, if the LED backlight is not bright enough, it can make the picture virtually impossible to see.
A TV with local dimming can mitigate these issues by dividing the LED backlighting into zones. That way, the TV can automatically adjust the brightness of each zone depending on the picture.