The <iostream> library header is a header that defines several of the standard stream I/O classes and objects, including cin and cout. It is mainly used to include those two objects, and the classes they belond to (istream and ostream, respectively) in a source file.
This post explains in detail the role of header files in general, if you are unfamiliar with them.
As every one said here the iostream stands for the input and output and their flow.For the use of the input and output in a program first we have to use this. #include<iostream> is an header file that is used in c++ in order to include the library files that are used for input and output.without using this header file one cannot deal with inputs and output in a particular program.