A Minimum Viable Product (MVP) is a concept in product development where a basic version of the product containing only the essential features is launched to gather early user feedback and realize the product idea. This helps startups and businesses test their assumptions and make improvements based on real user interactions. On the other hand, traction refers to the measurable progress and momentum with which a startup or business is achieving. It shows increased interest from customers, user base, and revenue growth that indicates the potential for long-term success.