A candidate block is a block that a mining node (miner) is required to mine as a method of gaining rewards.
Understanding the Term
A candidate block may be described as a temporary block that will be either validated or discarded by the network.
By collecting and organizing multiple unconfirmed transactions from the memory pool, candidate blocks are created by miners to participate in a mining competition where each miner is trying to be the one that validates and adds the block to the blockchain.
In order for a candidate block to be added to the blockchain, mining nodes have to go through several attempts of different hashing until the valid block hash is finally created.
A candidate block can only be added to the blockchain if there are no errors in the block hashing process.