Arcus is a NASA/MIDEX mission under development in response to the anticipated 2016 call for proposals. It is a freeflying, soft X-ray grating spectrometer with the highest-ever spectral resolution in the 8-51 Å (0.24 - 1.55 keV) energy range. The Arcus bandpass includes the most sensitive tracers of diffuse million-degree gas: spectral lines from O VII and O VIII, H- and He-like lines of C, N, Ne and Mg, and unique density- and temperature-sensitive lines from Si and Fe ions. These capabilities enable an advance in our understanding of the formation and evolution of baryons in the Universe that is unachievable with any other present or planned observatory. The mission will address multiple key questions posed in the Decadal Survey1 and NASA's 2013 Roadmap2: How do baryons cycle in and out of galaxies? How do black holes and stars influence their surroundings and the cosmic web via feedback? How do stars, circumstellar disks and exoplanet atmospheres form and evolve? Arcus data will answer these questions by leveraging recent developments in off-plane gratings and silicon pore optics to measure X-ray spectra at high resolution from a wide range of sources within and beyond the Milky Way. CCDs with strong Suzaku heritage combined with electronics based on the Swift mission will detect the dispersed X-rays. Arcus will support a broad astrophysical research program, and its superior resolution and sensitivity in soft X-rays will complement the forthcoming Athena calorimeter, which will have comparably high resolution above 2 keV.