Multiplexing allows a single medium to carry multiple signals simultaneously by dividing the medium into multiple channels. Time division multiplexing (TDM) divides the medium into time slots so that each signal is assigned a time slot. In TDM, time on the medium is shared equally between channels, with each channel receiving a specified time slot regardless of whether it has data to transmit. This makes TDM more efficient than frequency division multiplexing, which uses guard bands between channels and can waste capacity.