The ventriloquism effect is a perceptual phenomenon where a listener misattributes the location of a sound, believing it is coming from a source other than its actual origin. This effect illustrates how visual cues can influence auditory perception, leading people to perceive sounds as coming from a visual stimulus rather than the actual source. It showcases the interplay between different sensory modalities and highlights the brain's tendency to integrate information from various senses to create a coherent perception of reality.