Crypto is not just Bitcoin — there are thousands of smaller coins, which traders lump together as altcoins. Bitcoin dominance measures Bitcoin's slice of the entire crypto pie: out of all the money sitting in crypto, what share is parked in Bitcoin specifically.
When that slice is growing, it usually means people are playing it safe, keeping their money in the biggest and most established coin. When the slice is shrinking, money is spilling out of Bitcoin and into the smaller, riskier coins — which is the classic sign of what traders excitedly call alt season, when the little coins can run fast.