Lather (not to be confused with leather) is a rich foam of soap and water. Lather is created when (and for) washing and cleaning with soap and water. Other similar substances may also be called lather, for example shaving cream.
To lather (s.o. or s.th. up) means to cover an object or surface with lather, usually for the purpose of cleaning. For example, "she then thoroughly lathered up my butt." Leather can be created, spread and rubbed in with hands, bath brushes or sponges.