In cars, a problem that can occur when steering. When you turn the wheel, it doesn't seem the car is turning enough -- intuition tells you the car should be turning more than it is. One way to think about it is as follows: say you're driving a car around a bend, and you draw the arc of the curve. If your front wheels are not tangential to the arc, and indeed they are angled towards the centre of curvature of the arc, then you have understeer. It means that you have to turn more to end up where you would usually be.

Usually, unudersteer is caused when the front wheels have less traction then the back wheels. This could be because the front tyres are more worn, because there is more weight on the back, or several other reasons.

It's only really a problem for race drivers. In most cases, it's not a problem in normal circumstances, unless it's extreme, as it will limit your ability to get out of dangerous situations etc.