MPLS (Multi-Protocol Label Switching) simplifies packet forwarding by assigning labels to packets and using these labels for forwarding instead of long network addresses. It allows for traffic engineering and quality of service by establishing Label Switched Paths (LSPs) to direct different types of traffic over specific paths. MPLS supports various Layer 2 and Layer 3 protocols and improves network performance and scalability compared to traditional IP routing. It is widely used to implement virtual private networks (VPNs) across shared infrastructures.