A literature review is a synthesized critical analysis of scholarly writings that relate directly to your research question. It represents the existing literature and shows the relationship between those writings and your research question.
It is not the same as an annotated bibliography nor does it need to include everything on a particular topic. It should contain the most pertinent studies and point to important past and current research and practices in the field.
Why is a literature review needed?
A literature review is important because it:
Shows that you have a firm grasp of the topic, surrounding issues/controversies
Places your research within the larger academic narrative.
Creates an intellectual, historical, and theoretical framework for your writing
Demonstrates the importance of your research
Makes sure that your work is original and adds new knowledge to your field