Dead money in general is money in the pot that never belonged to any active player, or money that belongs to an active player who will probably fold.
Dead money is therefore a combination of dead blinds and bets by players who have folded or will fold. This kind of dead money improves the pot odds directly, since it means a player can win more for his bet than just the wagers of his active opponents.
Money wagered by players who barely have a chance of winning or who, it can be presumed will lose all their money if they stay at the table, is also called dead. In this sense, the term can also be used as slang for bad player.