Iteration and functions allow repeating processes over sets of values in R. Functions define reusable recipes that automate actions, taking inputs as arguments and returning outputs. apply() applies a function over the rows or columns of a matrix or dataframe, allowing aggregation like summing or averaging. lapply() and sapply() similarly apply a function over the elements of a list. Custom functions can be defined and then used with apply() to iterate complex processes like counting values exceeding a number of standard deviations from the mean.