Code refactoring means spring cleaning existing code. It usually implies changing the way the code is expressed without modifying what it does.
A refactor could improve code readability, reduce complexity, increase mainanability, etc.
A simple example could be improving the expressiveness of code by renaming variables. Silly example below:
# Original code class Rm def initialize (n, a, v) @n = n.to_i @a = a @v = v end end
# Refactored code class Room def initialize (no_of_windows, floor_area, volume) @no_of_windows = no_of_windows @floor_area = floor_area @volume = volume end end # aah, much better