This is the 403rd most frequent Russian word.
тем
The word "тем" in Russian is the instrumental singular form of "тот" (that) and can mean "by that," "with that," or "the [comparative]... the [comparative]" in certain constructions.
In this sentence, 'тем' is used as a demonstrative pronoun in the instrumental case, referring to 'that (thing)' or 'what' that she is engaged in.
Она занимается тем, что исследует космос.
She is engaged in exploring space.
Here, 'тем' is part of a comparative construction 'чем... тем...', indicating a relationship between increased learning and knowledge.
Чем больше мы учимся, тем больше мы знаем.
The more we study, the more we know.
In this example, 'тем' is used to introduce a subordinate clause, functioning as a reference to the explanation or condition provided in the clause.