To mod SimCity means to change the game in some way. Usually by either changing the games behavior, adding custom cars, props, buildings and lots within the game, changing the games terrain, roads, among other features.
Some of the most notable add-ons shown via building architect tools and lot editors. Other notable modifications have been added by fans using high-profile sites like Simtropolis. The most notable fan made modification to date has been the Network Addon Mod (NAM) for SimCity 4 and SimCity 4: Rush Hour. One of the most popular modding websites can be found here.