Amazon Elastic Compute Cloud (EC2) is a part of Amazon Web Services (AWS) that provides secure, resizable compute capacity in the cloud. It is designed to make web-scale cloud computing easier for developers, providing them with the tools to build and deploy applications. EC2's simple web service interface allows you to obtain and configure capacity with minimal friction.

EC2 provides virtual servers, known as instances, for compute capacity. Users can choose the size, power, memory capacity, and number of instances to suit their needs.

EC2 also offers features like load balancing and auto-scaling to help manage traffic and maintain application availability. It provides developers the tools to build failure resilient applications and isolate them from common failure scenarios.

Consider a small tech startup launching a new web application on AWS using EC2. As user traffic grows, EC2's auto-scaling feature automatically adjusts the number of active instances, scaling up during peak usage times for smooth performance, and scaling down during off-peak times to reduce costs.