What is the "Dew Point Depression"?
The dew point depression (often abbreviated to DPD), is the difference between the air temperature and dew-point of a sample. It can refer to surface (i.e. screen) temperature values, or to measurements in the upper air. The larger the value (wider separation between air temperature and dew-point), the lower the relative humidity.
Surface values of DPD (screen or psychrometer measurements) are often used in empirically derived algorithms to forecast overnight minimum temperatures, fog-point temperatures, height of convective cloud bases, likely stratus base due to turbulent-mixing etc. For example, a high afternoon DPD value would suggest low relative humidity for that air-mass (afternoon values usually being assumed to be representative due to good mixing of the boundary layer air), and assuming no air-mass change, the night minima will be relatively low, as would the fog-point temperature. Conversely, if the DPD value was small in the afternoon then, other factors being right (light wind, clear skies etc.), then mist/fog would be a high risk for the coming night - or low cloud if the wind were just a touch stronger. Daytime cumulus bases will be lower with small DPD values, than with a greater separation between air temperature and dew point.
Upper air values are often used to assess likely layered cloud amounts, again other things being equal - i.e. sufficient uplift to lead to condensation and a stable environment. On a thermodynamic diagram, if the 700 hPa DPD is less than about 3 degC, then expect thick, layer cloud to be present. Dew point depression values are also used in the study and forecasting of severe convective storms.