Azure's autoscaling feature allows applications to automatically adjust the number of instances based on the current demand. It uses metrics such as CPU utilization, request count, and response time to dynamically scale the resources. The autoscaling can be configured through Azure's portal or programmatically using Azure Management APIs.

When autoscaling is enabled, Azure monitors the application's performance and determines whether to scale up or down. Scaling up adds more instances to handle the increased load, while scaling down removes instances to optimize resource utilization. This ensures that the application can handle fluctuations in traffic and provides a seamless experience to users.

Azure offers different scaling modes such as manual, scheduled, and dynamic. Manual scaling allows developers to manually adjust the number of instances based on predefined rules. Scheduled scaling enables scaling at specific times or dates, useful for handling periodic spikes in traffic. Dynamic scaling automatically adjusts the resources based on real-time metrics, offering the most flexible and efficient scaling solution.