The factory pattern is a creational design pattern that provides a way to create objects without specifying the exact class of the object being created. It uses factory methods to deal with object creation. The factory pattern defines a common interface for creating objects but allows subclasses to determine which class to instantiate. The document describes implementing a factory pattern to create different shape objects like circle, rectangle and square by passing a string to the factory class to determine which object to return. It defines a shape interface and concrete classes, a factory class that returns the appropriate shape object based on the string, and a demo class that uses the factory to get shape objects.