To put it briefly, A Combolist is a text file containing a list of emails, usernames and passwords in a consistent format. Combolists are meant to be machine-readable so they can be used as input to tools that will automate authentication requests to a website or API.
A common example would be credential stuffing attacks. A tool like SentryMBA, an Account Checker, would use a Combolist to automatically check which accounts are valid for a site. Once these accounts have been validated they will be subject to a full account takeover and, inevitably, some sort of fraud.