It is an allowance that is paid by an employer to the employee as a part of the latter’s salary.
This is basically given to individuals who live in rented houses with the intention of making it easier for them to afford a place.

Example:
For example, if you are hired to work in Bangalore while your house is in Delhi. This will require you to stay in Bangalore in a rented apartment. Whatever rent you are paying (for example 15,000 rupees per month) make sure your employer adds that as HRA to your existing salary.