A link audit is a health check for your backlink profile. You find out who is vouching for you, whether any of them are dragging you down, and where the gaps are.
The short version
A link audit is a systematic review of a website's backlink profile to evaluate the quality and relevance of its links, identify potentially harmful ones, and find opportunities to build more.
What it looks at
Overall quality and relevance of linking sites
Anchor text patterns and any over optimisation
Potentially harmful or spammy links
Gaps compared with competitors
FAQ
How often should I do a link audit?
Periodically, and especially after a ranking drop, a migration, or if you suspect past manipulative link building. For most sites, once or twice a year is sensible.