Short for floppy-disk controller, FDC is an integrated circuit that dictates how data is written to and read from a floppy disk. More specifically, an FDC takes data from a computer and converts it to an appropriate storage format using FM (frequency modulation) or MFM (Modified Frequency Modulation) encoding methods. This way, data is kept as its basic binary values.
A computer with a floppy drive may encounter an FDC Failure error message when a physical hardware failure occurs with the floppy diskette drive. If you run into this error, see: How to troubleshoot floppy disk drive issues.