A chiplet-based product is one large chip built from several smaller dies in a single package, connected by a high-density interconnect instead of a circuit board. The idea is not new; what changed is that it became cheaper than the alternative.
The driver is yield. Defects occur at roughly a constant rate per unit of wafer area, so the chance that a die contains none of them falls sharply as the die grows. Past a certain size the economics become brutal: a very large monolithic die can lose most of a wafer to defects. Cut the same design into four smaller dies and each has a far better chance of being good, and the bad ones cost a quarter as much to discard.
The second reason is process mixing. Not every function benefits from the newest node. Logic gains from shrinking; analogue, I/O and SRAM largely do not. Chiplets let the compute die use an expensive leading-edge process while I/O and analogue stay on a mature, cheaper, better-characterised one.
The cost is packaging. Connecting dies at those densities needs interposers, through-silicon vias or hybrid bonding, and the power and thermal problems concentrate rather than spread out. This is why chiplets appear first in high-value processors and not in general-purpose parts: the packaging premium only pays back when the die was going to be enormous anyway. For most board-level designs it is context rather than something to act on — but it explains why the parts you buy are increasingly packages rather than chips.