This term is used by the Cassiopaeans to denote a non-physical state of being where entities that incarnate in 1st thru 4th densities exist between incarnations. This is also called a recycling zone.
Ra describes this as the first non-physical density or the density of wisdom, the first where thought can create reality without being bounded by material restrictions.
In reading Cassiopaea transcripts, it seems that we need to distinguish between occupying 5th density as a between lives stage from being a 5th density soul. The latter would mean one which had graduated from 4th density and no longer would incarnate there.
The subject is beyond our means of direct knowing. We can however make some general inferences on the nature of this and compare this with other material on reincarnation and afterlife.
Incarnation into a density which corresponds to a soul's general level of development is a necessary means for progress. Only incarnation may teach certain indispensable lessons. We find this idea largely across the board, from Cassiopaea to Steiner.
Ra explains experience as consisting of equal parts of space/time and time/space. Space/time corresponds to incarnate life, with motion in space and no control on the flow of time. Time/space corresponds to between lives contemplation, with free motion in time but no means of affecting space, so at least for 3rd density souls.
Steiner explains the between lives state or astral world as being based on thought in the same manner as the physical world is based on matter. Time for the incarnate beings flows forward, time for the beings between lives flows in the opposite direction. Generally, Steiner sees spirit as guiding the present from the future, whereas matter reaches for the future from the past. Each moment of consciousness is thus a meeting of these two streams. Steiner describes in detail how a sort of mirroring of the past life occurs in the astral world, where one gets to see the self from the outside, through the eyes of all one has interacted with.
The Cassiopaeans describe 5th density as timeless, thus each between incarnations state is concurrent with every other such state. The contemplation may be instantaneous or eternal, depending on viewpoint. Fifth density may be a sort of showroom of all which may be possible, but realizing these possibilities for one's edification needs to be done from the density that is appropriate to the lesson.
Distance between beings, or experiences of beings, would be a question of pure thought, where similarity measures distance. Thus, a being that is very fragmented or contradictory, i.e. is dissimilar with itself, may not even be recognizable as the same entity. So we could speak of a timeline of incarnations, simply measuring the similarity between each between-incarnations state, so that successive ones are closer together than ones separated by much change of the soul.
We have some relatively independent accounts of near-death experiences, many of which involve cessation of brain functioning, which we may compare with descriptions of a between lives state. What seems to be a common feature is that near-death experiences correspond to the near-deceased person's system of beliefs. There are for example many accounts of meeting Jesus. There are some common features such as going to a light or passing through a tunnel.
It may be that the mind structures the experience around familiar concepts. It may also be that this state is as Steiner describes it, such that knowing of something brings one closer to that which is known, i.e. the metric of distance is informational similarity. Thus one ends up in the company of those one lived with, which is often reported in near-death experiences and would explain the often proposed idea that people repeatedly incarnate as teams. One's degree of spiritual cohesiveness 'after' each incarnation would influence how much work or learning or planning can take place between lives. Thus in cases we may have an entirely mechanical law of karma, in other cases more or less intentional life plans.