From the article "Just When You Thought You Had It Down..." by Tony L. Callahan:

Link Density is the term used to refer to how many sites link to your site. Most are familiar with the idea of a reverse link lookup. For those that are not, a reverse link lookup is asking a search engine "How many web sites, other than my own, are linked to mine?". To perform a reverse link lookup in Alta Vista, type a simple query like:

+link:www.hotmail.com -host:www.hotmail.com

This query will result in around eighty four thousand pages being found. This is an outstanding number of web pages, all linked to Hotmails web site, and a very good example of link density. Now will your site stack up against Hotmail? Probably not, but you are probably not in direct competition with Hotmail anyway. To get an feel for more down to earth numbers, do a search for "web hosting". Take the first site you find and plug the URL into our query above. When I did this little test I got nine hundred sixty nine pages found.

Link density, in some respects, is similar to link popularity. Where link popularity refers to the popularity or value of a website that links back to yours, link density is a more general term. Link density also encompasses the links to your home page via the subpages on your site. By creating a link to the home page on every subpage within your page, you emphasize the importance of the home page.

Link Density Tools

Link Density checker

 

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