Here's my attempt at making it as simple as possible. (Sorry to anyone who has seen me repost this in several different communities, just trying to make it easier for people to engage and this seems to have good feedback)

The Fediverse

The Fediverse -- Federation + Universe -- is a space on the internet that hosts several social media-like platforms. Lemmy is like Reddit, Mastodon is like Twitter, PeerTube is like YouTube, etc.
The main difference -- in terms of ownership and influence -- is that these platforms aren't owned by a single entity in the same way Google owns YouTube, Elon Musk with Twitter, Meta with Facebook, etc. In contrast, the Fediverse and its platforms are decentralized meaning no one wholly owns it and a person can't just make a decision for the entire Fediverse/platform.
As a relevant example, no one can just arbitrarily decide to make you pay $20 million per year for accessing a platform's backend stuff. The Fediverse avoids the advertising, algorithms, and other unpleasantries that plague many social networks.
As well, different platforms within the Fediverse can communicate with each other, like how a Gmail user can email a Yahoo Mail user. Reddit, Twitter, and YouTube can't do that.

Lemmy

Going back to trying to ELI5 Lemmy... Lemmy the platform, within the Fediverse, is one planet. Like planet Earth in the universe
“Instances” like lemmy.world, lemmy.ml, beehaw.org, etc. are like the different countries on Earth
When someone signs up, the user picks one instance to be a part of, like how an Earthling becomes a citizen of a country
If you register at lemmy.world, that means your home instance / “home country” is lemmy.world, but you can “travel” to lemmy.ml, another instance / “country”, to check out and subscribe to their community
When you subscribe to a different instance that’s not your home instance, you can still participate in their content, and other people will be able to see which instance / “country” you’re from
Each instance can have its own version of the same community / “subreddit”, so you can have a c/Memes in your home instance that is different from a c/Memes in another instance. But you can subscribe to both separately
c/[community name] is the naming convention used here I think like r/[subreddit name] on Reddit. If talking about a community in a different instance, it's c/[community name]@[instance name] so like c/memes@lemmy.ml

Someone please correct any of this if any of it is wrong, I’ll happily edit