Graph density is a measure that indicates how many edges are present in a graph compared to the maximum number of edges possible. It is calculated by dividing the number of edges by the number of possible edges, which depends on the number of vertices in the graph. A higher graph density suggests a more interconnected structure, while a lower density indicates a sparser arrangement. In mathematical terms, for a simple graph with n vertices, the maximum number of edges is given by n(n-1)/2. Thus, the formula for graph density is: density = edges / (n(n-1)/2). This concept is useful in various fields, including network theory and social network analysis, to understand connectivity and relationships within a dataset.