由 means 'from', 'by', or 'due to', and 此 means 'this' or 'here'. Together, 由此 literally means 'from this' — indicating that what follows is a logical consequence or inference drawn directly from the preceding situation, fact, or reason. It functions as a formal linking word in written and spoken Chinese, often appearing at the beginning of a clause or sentence to signal causation or conclusion.

This term is common in academic writing, news reports, explanations, and everyday reasoning — for example, when summarizing why something happened or what will happen next. While it carries the same basic meaning as 'therefore' or 'thus', 由此 tends to emphasize the direct connection between cause and effect, making it slightly more precise and formal than simpler alternatives like 所以. It’s rarely used in casual speech unless the speaker is being deliberately clear or emphatic about logical flow.