Understanding DPI & Resolution

Image resolution describes the amount of detail an image holds. Higher resolution images are crisper and more detailed. In a lower resolution image, the fine differences in color disappear, edges become blurred, etc. There are many kinds of resolution that can apply to film, television, etc but the two types we are concerned with here are print resolution and screen resolution.
Screen resolution is measured in pixels per inch (PPI). A pixel is a tiny square of color. A monitor uses tiny pixels to assemble text and images on screen. The optimal resolution for images on screen is 72 DPI. Increasing the DPI won’t make the image look any better, it’ll just make the file larger, which will probably slow down the website when it loads or the file when it opens.
Print resolution is measured in dots per inch (or “DPI”) which means the number of dots of ink per inch that a printer deposits on a piece of paper. So, 300 DPI means that a printer will output 300 tiny dots of ink to fill every inch of the print. 300 DPI is the standard print resolution for high resolution output. This means that that images should be a minimum of 300 dpi x 300 dpi or 90,000 dots per square inch to produce a high resolution print
How the two work together: Documents begin on screen and either stay on screen, or they are printed. If the document will stay on the screen (like a website), you just need to worry about screen resolution, so your images should be 72 PPI (open to discussion or argument). An important note: Sometimes the terms DPI (print) and PPI (screen) are used interchangeably. So, don’t be confused if someone refers to a 300 DPI image that is on screen, because pixels per inch (PPI) translate equally to dots per inch (DPI).
If you’re going to print the document, you need to make sure the images are 300 DPI at 100% of the final output size. This sounds more complicated than it really is. The bigger we try to print the 300 pixel × 300 pixel image, the more pixellated it becomes. The eye can start to see the individual pixels, and the edges become very jagged.