A torque arm is a suspension piece on cars the use a 3-link rear end design. The torque arm connects the the differential housing on one end, and typically the transmission mount on the other end. The purpose of the torque arm is to keep the geometry of the rear end square under cornering loads, while letting the driveshaft do its thing without having to be a suspension member as well.
Most RWD cars come with fairly cheap torque arms, which can flex and lead to the rear wheels not pointing straight forward. Aftermarket torque arms correct this by using stronger materials, at the cost of higher weight (and cost!). | 
