Byzantine Fault Tolerance (BFT) is a consensus algorithm designed to achieve agreement among distributed nodes, even when some nodes may fail or act maliciously. It is crucial in environments where trust is not guaranteed, such as blockchain networks. BFT ensures that as long as a majority of nodes are functioning correctly, the system can reach a consensus on the state of the ledger, thereby maintaining integrity and reliability. This feature is essential for decentralized applications that require high availability and security against adversarial attacks.