It states that if the truth of the property for x follows from its truth for all elements of x, for every set x, then the property is true of all sets. In symbols:
Considered as alternative set theory axiom, it's called axiom of induction.
In the context of CZF however, foundation implies the law of excluded middle while the induction sheme does not. In other words, with constructive logic, set induction is strictly weaker than foundation.