Predictive Processing (PP) is a neuroscientific theory of the brain. The theory suggests that the brain’s purpose is to make sense of the world in which the individual finds themselves. We would naturally assume that the brain processes sensation through a sequence of filters, until, say, an array of colour becomes a car.
In reality, that would be extremely computationally expensive, requiring brains much bigger than we actually have. Instead, so they theory suggests, we build a “model” of the world in which we exist, and make predictions as to what we believe to be in front of us, and then verify those predictions against sensory experience.
Should sensory information challenge the prediction, a “prediction error event” is said to occur. At this point, the brain has to adjust its model of the world. A common example of this is with optical illusions. Once you’ve seen how it works, it doesn’t surprise anymore. Our new model doesn’t allow the trick to work.