Distressing covers the range of techniques used to make new denim look worn before it has actually been worn, including sanding or scraping the surface, deliberately fraying seams or pocket edges, cutting small holes or slashes, and roughing up areas that would naturally rub with use, such as the thighs, knees and back pockets. It is a manufacturing step applied after the garment is sewn.
The amount of distressing ranges from very subtle, just a slightly softened surface or faint whiskering, to heavy, with large holes, frayed hems and visibly thinned fabric. Because distressing is applied deliberately, its placement is usually more even and predictable across a size run than the fading that comes from years of actual wear, though well done distressing aims to imitate that natural pattern closely.
Heavily distressed jeans, especially those with holes, tend to read as casual and are worth checking for durability at the distressed points before buying. See whiskers and fades for specific wear patterns often recreated through distressing, and our guide to jeans washes and finishes for the wider picture.