Mimesis is a Greek term that means imitation. The first step in understanding Aristotle's account of mimesis is remembering that he spent many years studying at Plato's Academy. In Platonic thought, the things we encounter via our senses, the phenomena, are imitations of ideal forms. Art (whether poetry or painting), in imitating the phenomena, is thus merely an imitation of an imitation. Plato also divides imitation by medium (words, paint, marble, etc.). He further divides the verbal techniques of imitation into pure imitation or mimesis, in which an actor impersonates a character on stage, and diegesis, or narration, in which a narrator speaks in the third person about events. Epic is a mixed form, using both impersonation and narration when performed by a rhapsode. Plato tends to condemn imitation as degrading, because (1) impersonation can inculcate bad or non-rational habits and (2) because it focuses attention on mere phenomena.
Aristotle accepts the Platonic distinction between mimesis and diegesis, but finds both valuable as modes of training and educating emotions. Ontologically, he does not believe in separated forms, but argues that forms inhere in phenomena, and thus the only way to understand concepts or qualities is as they are embodied and thus advocates rather than objects to close study of appearances.
For Aristotle, mimesis is a natural human activity. He agrees with Plato that children learn by imitation. While Plato worried that people observing villains or despicable characters in poetry would imitate them, Aristotle believes that bad examples teach people how not to behave just as good examples teach people how to behave.