In simple terms, polymorphism is the ability of one type, A, to appear as and be used like another type, B. In strongly typed languages, this usually means that type A somehow derives from type B, or type A implements an interface that represents type B. In non-strongly typed languages (dynamically typed languages) types are implicitly polymorphic to the extent they have similar features (fields, methods, operators). In fact, this is one of the principal benefits of dynamic typing. – Wikipedia
Polymorphism is tightly coupled to the inheritance and is often considered to be one of the most powerful feature of the object oriented programming. It can be defined as a term according to which a name (variable declaration) may denote objects of many different classes that are related by some common suprclass; thus, any object denoted by this name is able to respond to some common set of operations in different ways. – Grady Booch

Lets consider an example:
There are two array of shapes called Rectangle and Circle. Even though we treat both these as a Shape but their implementation is quite different. In nutshell, each class is able to respond differently to the same method getArea(). This is called Polymorphism.

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