A caterpillar develops toxic spikes to deter the bird that preys on it. Over time the bird develops a digestive enzyme that neutralizes the toxin. This is an example of:

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The scenario described is an example of coevolution, which is the reciprocal evolution of two or more interacting species. The caterpillar and bird are engaged in a predator-prey relationship, with the caterpillar developing a defense mechanism (toxic spikes) to deter the bird, and the bird evolving a countermeasure (digestive enzyme) to neutralize the toxin. This back-and-forth adaptation between the two species is a classic example of coevolution.

A Caterpillar Develops Toxic Spikes to Deter the Bird That