EMZETT.Multiplexing
Image: Christophe Dang Ngoc Chan, CC BY-SA 3.0, Wikimedia Commons
In short: Bundling several independent data streams onto a shared transmission line so that they share one physical connection efficiently.
In more detail: In a networking context, ports, for example, allow several applications to communicate simultaneously over the same network card — the ports “multiplex” the one physical channel into many logical ones. With SSH (SSH-CONNECT) too, several channels can be multiplexed over a single connection.
In Depth
Multiplexing solves a fundamental problem: a device has only a limited number of physical network interfaces, but often has to communicate with many different counterparts or applications at the same time. At the transport layer, ports take on this task: each application is assigned its own port number, so that incoming packets can be delivered to exactly the right application based on the combination of IP address and port — a single computer can thus run a web browser, a mail client and an SSH client at the same time, even though all of them run over the same network interface.
At higher levels there are further forms of multiplexing: HTTP/2 multiplexes several parallel requests over a single TCP connection (instead of opening a new connection per request as with HTTP/1.1), which saves overhead. SSH uses its CONNECT sub-protocol to multiplex several logical channels (e.g. an interactive shell and at the same time a forwarded database connection) over a single authenticated connection. The counterpart is called demultiplexing: on the receiving side, the interleaved data streams have to be correctly assigned back to the original applications/channels.