A race condition is a logical vulnerability that can occur when multiple threads access and attempt to modify shared data simultaneously. It is easy to miss in source code but can lead to critical vulnerabilities, especially in web applications. A race condition occurs when thread execution is not synchronized properly and results may depend on the particular order in which threads execute. Some examples of race conditions in web applications include temporary files being deleted before being fully processed and concurrent funds transfers that could result in inaccurate account balances. Proper locking and synchronization of shared resources is needed to avoid race conditions in multithreaded applications.