Encapsulation is a fundamental principle of object-oriented programming (OOP) that focuses on bundling data and methods within a single unit called a class. In C#, encapsulation is achieved by using access modifiers (such as public, private, and protected) to control the visibility and accessibility of class members. By encapsulating data and methods, you can protect the internal state of an object and ensure that it is accessed and modified through defined interfaces. Encapsulation promotes code organization, reusability, and improves the maintainability and flexibility of your C# code.