In auctions, proxy bidding—also known as autobid—allows you to set the maximum amount you're willing to pay for an item. The auction system then automatically places bids on your behalf, incrementally increasing your bid just enough to maintain your position as the highest bidder up to your specified maximum. This means you don't need to monitor the auction constantly; the system manages your bids for you. If another bidder surpasses your maximum bid, you'll be notified and can decide whether to increase your maximum limit.
 
For example, if you set a maximum bid of $100 on an item, and the current bid is $50, the system might place a bid of $55 on your behalf. If someone else bids $60, the system will automatically bid $65 for you, continuing this process until your maximum bid is reached.
This feature is particularly useful in online auctions, as it allows you to participate without being present throughout the entire bidding process. It ensures you remain competitive up to your predetermined limit, helping you avoid overbidding in the heat of the moment.