Nepotism is the act of favoring one's own relatives over other applicants in inappropriate contexts. This generally means preferential hiring in business, or political appointments and awarding government contracts in politics. These practices are heavily restricted in most developed countries, but continues to be a grey area in many situations. It is generally held that 'bad' nepotism is when you favor a family member over a more qualified candidate, and that favoring a family member who is equal or greater in qualification to other applicants is a bit of a grey area.

The word nepotism comes from the same root as 'nephew', the Latin nepos, and originally referred specifically to the practice of the Catholic church granting favors, particularly positions in the cardinality, to members of the pope's family. This was particularly common in the case of a pope's nephews; as the pope could have no sons, his nephews were seen as a fitting substitute for continuing his male line. It was also common to refer to an illegitimate son of the pope as his 'nephew', although this was not, apparently, an attempt to deceive but rather a polite, and often transparent, social nicety.

The term was first recorded in 1660, probably because the familial favoritism in the church was becoming a political issue. The practice was officially ended just thirty years later, in 1692, when Pope Innocent XII issued the papal bull Romanum decet Pontificem, prohibiting popes from bestowing estates, offices, or revenues to any relative, with the exception that one (and only one) qualified relative could be made a cardinal.