When a collision is detected on a shared medium Ethernet 802.3 LAN when CSMA/CD (Carrier Sense Multiple Access with Collision Detection) is used, the transmitting device stops sending data and waits for a random amount of time before attempting to transmit again. This random delay is called the "backoff time" and is designed to reduce the likelihood of another collision occurring. Meanwhile, all other devices on the network also stop transmitting and wait for a brief period of time before resuming their own transmission attempts. Once the backoff time has elapsed, the transmitting device will attempt to send the data again and the process repeats until the transmission is successful or the maximum number of retransmissions is reached. This process is crucial for ensuring efficient and reliable communication on a shared medium Ethernet 802.3 LAN.