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A Sugar Baby is a slang term for a female or male (usually pretty young but adults) who is financially pampered/cared for by a "Sugar Daddy" (usually much older than the Sugar Baby) or "Sugar Mama" (usually much older than the Sugar Baby) in exchange for companionship.
Sugar Babies are not ageplayers, are not adult babies, are not littles, and are not in a Caregiver/little dynamic. They are not the same as what we think of as adult babies at all.
It's very closely related to escorts. Escorts often will exchange money for "companionship"--sometimes physically intimate favors. Many times Sugar Babies do the same thing. The Sugar Daddy will financially support them as long as they go on dates with him, do physically intimate favors, are overly flirtatious to them to provide attention, or anything else they mutually agree upon.