Error code 16 appears with the message “Steam Client failed to process the operation: Steam error code 16, Steam error message: Timeout, operation timed out.” In Valve's own status list, code 16 means Timeout, so Steam started an operation and the other end did not answer in time. It can appear when launching a game, updating, editing a profile, or sending a trade, and the fix depends on where it shows up.
The fix, in order
Wait a minute and retry. A timeout is often a brief server delay, and a second attempt succeeds.
If the error appeared during a trade, check the trade history and inventory first. A timed-out trade may still have gone through, so do not send a duplicate offer until the first one is confirmed as failed.
Restart Steam completely, using Steam, Exit, then reopen it.
Check the internet connection. Restart the router, and test another site or service to confirm the connection is stable.
Update Steam under Steam, Check for Steam Client Updates, and install any pending Windows updates.
Verify the integrity of game files if the error appears when launching a game. In the Library, right-click the game, open Properties, then Installed Files, and click Verify integrity of game files.
Close conflicting programs, update the graphics driver, and reinstall the Visual C++ redistributables if the error keeps appearing at launch.
Clear the download cache under Settings, Downloads, then sign back in.
If it still happens
If timeouts happen for everything Steam does, the connection itself is the problem, so test a different network or a wired connection, and check whether a VPN or proxy is slowing traffic. If the error only happens for one action, such as one trade or one game, the cause is specific to that action, not to Steam as a whole.
Common questions
Did my trade fail if I got error 16? Not necessarily. Error 16 means the server was slow to answer, and the trade may have gone through anyway. Check the trade history before sending another offer.
Is error 16 a problem with my PC? Usually not. It is a timing problem between Steam and its servers, and it often clears on its own. Local causes, like a weak connection or conflicting software, matter only when it keeps happening.