A database is an organized collection of inter-related data.
There are three keywords in the above definition: organized, collection and inter-related.
What do we mean by 'organized'?
The term Organized here refers to the way the data needs to be stored. Only if the data were organized, would the user be able to locate the data and retrieve it efficiently.
Collection' refers to a group of data and not just one piece of data. These are usually collection of data belonging to a variety of data types. Some of the data items may be integers; some may be real number, while others may still be structured data types.
The requirement that the data items are 'inter-related' refers to a collection of data that provides sensible, cohesive information.
Information and data means two different things. When a data in its entirety makes sense to a business, it becomes information. In other words, processed data is often called as information. A database helps the user by supplying him with sufficient information. Here, we will look at computerized data, as that is what we are basically interested in. Physically, data in a computer is stored in the form of files. A computerized collection of data, which constitutes a database, is stored as data files in a computer.
So in what way is a database different from data files discussed earlier? To understand this clearly, we must note that databases, on their own, perhaps add very little value over the flat data files. But when there is a database management system, it provides the creator and the user of the application with some powerful benefits.