When you use 2-Step Verification, some apps or devices may be blocked from accessing your Google Account. App Passwords are a way to let the blocked app or device access your Google Account.

Tip: Whenever possible, connect apps to your Google Account by selecting the “Sign in with Google” option available in many apps

What is App Password?

An App Password is a 16-digit passcode that gives a non-Google app or device permission to access your Google Account. App Passwords can only be used with accounts that have 2-Step Verification turned on.

How to Create App Password

Note: If you use 2-Step-Verification and are seeing a “password incorrect” error when trying to access your Google Account, an App Password may solve the problem.

• Go to your Google Account.
• On the left navigation panel, choose Security.
• On the “Signing in to Google” panel, choose App Passwords.
• If you don’t see this option:
  2-Step Verification is not set up for your account.
  2-Step Verification is set up for security keys only.
• Your account is through work, school, or other organization.
• You’ve turned on Advanced Protection for your account.
• At the bottom, choose Select app and choose the app you’re using.
• Choose Select device and choose the device you’re using.
• Choose Generate.
• Follow the instructions to enter the App Password. The App Password is the 16-character code in the yellow bar on your device.
• Choose Done.

Most of the time, you’ll only have to enter an App Password once per app or device, so don’t worry about memorizing it.

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Credit : Above content is taken from Google Support Forum.