Nested queries, or subqueries, are a powerful feature in SQL that allows you to embed one query inside another. This enables you to perform complex filtering and data retrieval operations that would be difficult or impossible with a single query. Imagine you need to find all customers who live in the same city as a specific employee. A nested query can efficiently accomplish this task. The outer query (the main query) retrieves data, and the inner query (the subquery) filters that data based on a specific condition. The results of the inner query are then used by the outer query to refine its own results. This approach is particularly useful when you need to perform calculations, comparisons, or aggregations within the context of another query. Nested queries can be used in various clauses of a SQL statement, such as the `WHERE` clause, `SELECT` clause, and `FROM` clause. They are a crucial tool for advanced data manipulation and retrieval in SQL databases.