A situation wherein the number of people trying to use a computer simultaneously has reached the point where no one can get enough cycles because they are spread too thin and the system has probably begun to thrash.

This scenario is an inevitable result of Parkinson's Law applied to time-sharing. Usually the only solution is to buy more computer. Happily, this has rapidly become easier since the mid-1980s, so much so that the very term "cycle crunch" now has a faintly archaic flavour; most hackers now use workstations or personal computers as opposed to traditional time-sharing systems.

[Jargon File]