Data Flow Diagrams (DFDs) are visual representations that illustrate how data moves through a system. They show the flow of information between different components, such as processes, data stores, and external entities. By using symbols like circles for processes and arrows for data flow, DFDs help simplify complex systems, making it easier to understand how data is processed and transferred. DFDs are commonly used in software development and systems analysis to identify requirements and improve system design. They can help teams visualize interactions and pinpoint areas for improvement, ensuring that all stakeholders, including developers and project managers, have a clear understanding of the system's functionality.