A literature review synthesizes and critically analyzes the state of the research on a topic. It is useful to help you understand the history, significant developments, potential gaps, and current direction of research in a field. Sometimes you are verifying that your own research is new and original.
Sometimes it is a clearly labeled section within a larger paper, like this:
Sometimes, literature reviews are not labeled as a separate section, but are part of the introduction. A good clue that it's a literature review is if it includes multiple citations of other significant works in the field:
Other times, an entire published paper consists of just a literature review, as in the examples below.