Amdahl's Law is a formula used to find the maximum improvement of a system when only part of it is improved. It states that the overall speedup of a process is limited by the fraction of the process that cannot be improved. For example, if 75% of a task can be sped up, the maximum speedup is limited by the remaining 25% that cannot be improved. This law highlights the importance of identifying bottlenecks in systems, especially in computing and parallel processing. Understanding Amdahl's Law helps engineers and developers make informed decisions about where to focus their optimization efforts for the best overall performance.