Blend Spaces are special assets which can be sampled in AnimGraphs that allow for blending of animations based on the values of two inputs. Simple blending between two animations based on a single input can be performed using one of the standard Blend nodes available in Animation Blueprints. Blend Spaces provide a means of doing more complex blending between multiple animations based on multiple values (currently limited to two).
The goal of Blend Spaces is to reduce the need for creating individual, hard-coded nodes to perform blending based on specific properties or conditions. By allowing the animator or programmer to specify the inputs, the animations, and how the inputs are used to blend between animations, virtually any type of blending can be performed using the generic Blend Space.