Advanced segments in Google Analytics allow users to isolate specific types of traffic, such as paid search traffic from Google AdWords, to more closely monitor their performance and behavior. To create an advanced segment for AdWords traffic, users select the medium as CPC and the source as Google, name the segment, then can view metrics like visits over time or use the dimensions tab to analyze visitor behavior and evaluate the effectiveness of AdWords campaigns. Advanced segments provide a powerful way to segment traffic in Analytics for more detailed analysis.