"IO" stands for input/output. IOPs stands for input/output operations per second.

Every time something is written to, or read from, a storage solution - that generates an IO operation. Physical disks have a limited number of IO operations per second (IOPs) that they can handle. Storage devices - including servers with local drives - often include multiple physical disks so the IOPs capacity would be a calculated combination of those resources, taking into account RAID level overhead and other factors.

If your application, or a combination of all the applications using that storage system, generate IOPs traffic in excess of the systems maximum IOPs capacity, the requests start to queue up and wait - meaning everything starts to run just a bit slower. Then as IOPs load continues to increase, things run slower and slower until performance is no longer acceptable.

It is very important to properly scale your system in a way that can support IOPs well in excess of the expected load - to allow for both traffic increases and to handle short bursts when they arise.