This question is general, and a good interviewer will give
the candidate some guidance by adding, "What did you learn from it? How did you make a change/changes to correct your mistake." Include what you learned and how you recovered, even if the interviewer does not give you that hint.
Failure is part of life, and is hopefully a learning experience. Smart interviewers realize this and look for candidates who can recognize and recover from failure. See the sample answer, and follow Job Search Expert Bob McIntosh’s strategies to effectively answer this scary question.