Lemmy is a Fediverse software which is able to federate content with other instances and even other Fediverse softwares (e.g kbin). Federation is what allows an instance (e.g. aussie.zone, the one I’m on) to interact with others (e.g. reddthat.com, lemmy.ml, mander.xyz, etc.), so we can visit their communities, subscribe, post, vote on their posts, comment, and more.

Defederation is removing federation, which in this case would mean aussie.zone can’t interact with lemmy.ml, view their communities and posts, etc… It would occur if the aussie.zone admin sets the site to stop federating with lemmy.ml.

Defederation can be useful if an instance is abusive and systematically federates unwanted content, for example in early days before the reddit API exodus, there was a particular ‘free speech’ instance with a lot of neo-nazis which was defederated by most other instances before it shut down. In another case back then, some troll was registering new accounts every day on any instances without signup questions, so they could evade bans and post shock pornography on lemmy.ml. lemmy.ml ended up defederating from every open instance until they secured their registration form to avoid the abuse. You can see a list of federated and blocked instances by going to an instance and clicking on the Instances button at the bottom of the page. You can see aussie.zone blocks a few dedicated pornography instances, and a few explicitly political instances.