Two Factor Authentication is a secure way of adding additional security to your account. The first step or factor is your usual password that set for an account, the second is a sending a OTP to your smart phone or create a code is Google authenticate.
In simple words, when you log in to your account using your password and username or email, an extra security code is asked; i.e. a piece of private information like OTP.
Now a days company like Godaddy, Google, Facebook, Zoho are using two factor Authentication to provide more security to their user.