Cascading demultiplexers refers to the technique of connecting multiple demultiplexers in a series, allowing for the distribution of a single input signal to multiple output lines. This method enhances the number of outputs available from a single input source, increasing the flexibility and functionality of data routing in digital circuits. By arranging demultiplexers in this way, you can efficiently manage larger data streams and control signal paths, making it a vital aspect of digital communication systems.