Stem-mixing is a method of mixing audio material based on creating groups of audio tracks and processing them separately prior to combining them into a final master mix. In other words you can have your stems to a track and control the mix. This way you can turn off the drums of one song while bringing in the drums of the next. There is more versatile in the actual track playback with Stem mixing than DJing
A basic Stem Mixing set up in Ableton Live would be to have two different sets of 4 tracks. Each of the 4 would have 4 stems for that track. You could also set up the cross fader to move between the two tracks just like a traditional DJ set. This does have a little more setup time. It's also best for a group that can create stems from their music.
Creatively, this gives you a way to start remixing your own tracks on the fly. You can turn parts on and off and fluidly mix between the different stems. You can also turn off the drums of "track 1" and bring in the bass line of "track 2" in your transition. Below is an example image of what this would look like.