Also called private registration, WHOIS Domain Privacy protects your personal information (phone number, email, and physical address) from being shown in the publicly available WHOIS database.
As background, ICANN, the governing body for domain names, mandates that all domain registrars publish the personal contact information of domain registrants in the public WHOIS database. Email and phone scammers scrape and collect this information for spam, scams, and identity theft.
Domain Privacy prevents these spammers from collecting your personal info. DreamHost's complementary (yes it's free for the life of your domain) Domain Privacy service works by masksing your personal information in the WHOIS database with DreamHost's corporate information, so you're protected from unscrupulous marketers, spammers, robo-callers, junk mailers, and stalkers.