The total distance that a football is thrown beyond the line of scrimmage to the point of reception. Air yards can be calculated by taking total passing yards and subtracting Yards After the Catch (YAC).
Many believe that air yards are a better barometer of a quarterback's performance than total yards because there are two distinct aspects of the "pass".
For example, compare a 5-yard dump pass that results in a 50-yard gain and a 50-yard pass in the air. Both contribute the same to a quarterback's total passing yards (and a receiver's total receiving yards), but if we were to compare air yards it would tell a very different story about who was the main contributor to each play.