In Red Dead Online, the franchise's iconic Dead-Eye aiming mode works very differently than in any other game or mode. While the single-player portion of Red Dead Redemption 2 mostly retained the function of the Dead-Eye mechanic from its predecessor, it was significantly overhauled for the multiplayer spin-off.
The main difference is that Dead-Eye no longer slows down time. While a particularly colossal alteration since the whole point of Dead-Eye in all previous instances was slowing down time for the sake of easier aiming, this would have been impossible to implement in a multiplayer environment while keeping things balanced.
Instead of slowing down time, Dead-Eye in Red Dead Online is used to activate Ability Cards. All players have a total of 4 ability card slots, which include one active or "Dead-Eye" ability and three passive abilities, which are progressively unlocked as you rank up.
While removing the obvious advantage of slowing down time for better aiming is regretful, Rockstar managed to ensure that Dead-Eye remains useful by tying it to this integral new gameplay feature. Without Dead-Eye, the new ability system would not work. This means that depending on what ability card you have equipped, activating Dead-Eye will let you regenerate health, give your posse members damage buffs or prevent enemies from locking onto you.
There is one ability that makes the mechanic work more akin to its single player version. With the "Paint It Black" ability card, during Dead-Eye you can mark enemy players or NPCs whom your character will automatically aim at and fire upon once you come out of Dead-Eye, working like the auto-aim feature of the upgraded ability in story mode.
Even though Dead-Eye lost its iconic time-slowing mechanic, using it will still trigger the same visual cues as in single player. The same filter will cover the screen - which without the actual slow-mo is arguably a hindrance rather than a crutch. Activating it is achieved with pressing the right analog stick/pressing the middle mouse button, as usual.