It is a concept found in Hinduism and Jainism in relation to ending the samsara (the cycle of death and rebirth).
[1] The concepts of Jivanmukta and Videhamukta are particularly discussed in Vedanta and Yoga schools of Hindu philosophy.
Videhamukti may signify the liberation while alive as the state beyond turiya, when mind dissolves and there is not the slightest distinction or duality.
Meher Baba, who started out Zoroastrian, and was initially affected by a Muslim holy woman, and who integrated the Sufi (Islamic) and Vedantic (Hindu philosophical) ideas and terms, gives a very detailed and complete description of liberation in his book God Speaks, supplement 24.
According to Advaita, a liberated human being (jivanmukta) has realised Brahman as his or her own true self and has achieved infinite knowledge.
In all cases, after the soul dissociates from the body, it eternally experiences infinite power, knowledge and bliss.
The importance of this distinction is that such a soul literally experiences an eternal "I am God" state rather than being introduced to an afterlife of "I am infinite bliss."