Data mining is the process of extracting and finding patterns in massive data sets involving methods at the intersection of machine learning, statistics, and database systems. Data mining is an interdisciplinary subfield of computer science and statistics with an overall goal of extracting information (with intelligent methods) from a data set and transforming the information into a comprehensible structure for further use. Data mining is the analysis step of the "knowledge discovery in databases" process, or KDD. Aside from the raw analysis step, it also involves database and data management aspects, data pre-processing, model and inference considerations, interestingness metrics, complexity considerations, post-processing of discovered structures, visualization, and online updating.

The term "data mining" is a misnomer because the goal is the extraction of patterns and knowledge from large amounts of data, not the extraction (mining) of data itself. It also is a buzzword and is frequently applied to any form of large-scale data or information processing (collection, extraction, warehousing, analysis, and statistics) as well as any application of computer decision support systems, including artificial intelligence (e.g., machine learning) and business intelligence. Often the more general terms (large scale) data analysis and analytics—or, when referring to actual methods, artificial intelligence and machine learning—are more appropriate.

The actual data mining task is the semi-automatic or automatic analysis of massive quantities of data to extract previously unknown, interesting patterns such as groups of data records (cluster analysis), unusual records (anomaly detection), and dependencies (association rule mining, sequential pattern mining). This usually involves using database techniques such as spatial indices. These patterns can then be seen as a kind of summary of the input data, and may be used in further analysis or, for example, in machine learning and predictive analytics. For example, the data mining step might identify multiple groups in the data, which can then be used to obtain more accurate prediction results by a decision support system. Neither the data collection, data preparation, nor result interpretation and reporting is part of the data mining step, although they do belong to the overall KDD process as additional steps.

The difference between data analysis and data mining is that data analysis is used to test models and hypotheses on the dataset, e.g., analyzing the effectiveness of a marketing campaign, regardless of the amount of data. In contrast, data mining uses machine learning and statistical models to uncover clandestine or hidden patterns in a large volume of data.

The related terms data dredging, data fishing, and data snooping refer to the use of data mining methods to sample parts of a larger population data set that are (or may be) too small for reliable statistical inferences to be made about the validity of any patterns discovered. These methods can, however, be used in creating new hypotheses to test against the larger data populations.

In the 1960s, statisticians and economists used terms like data fishing or data dredging to refer to what they considered the bad practice of analyzing data without an a-priori hypothesis. The term "data mining" was used in a similarly critical way by economist Michael Lovell in an article published in the Review of Economic Studies in 1983. Lovell indicates that the practice "masquerades under a variety of aliases, ranging from "experimentation" (positive) to "fishing" or "snooping" (negative).

The term data mining appeared around 1990 in the database community, with generally positive connotations. For a short time in 1980s, the phrase "database mining"™, was used, but since it was trademarked by HNC, a San Diego–based company, to pitch their Database Mining Workstation; researchers consequently turned to data mining. Other terms used include data archaeology, information harvesting, information discovery, knowledge extraction, etc. Gregory Piatetsky-Shapiro coined the term "knowledge discovery in databases" for the first workshop on the same topic (KDD-1989) and this term became more popular in the AI and machine learning communities. However, the term data mining became more popular in the business and press communities. Currently, the terms data mining and knowledge discovery are used interchangeably.

The manual extraction of patterns from data has occurred for centuries. Early methods of identifying patterns in data include Bayes' theorem (1700s) and regression analysis (1800s). The proliferation, ubiquity and increasing power of computer technology have dramatically increased data collection, storage, and manipulation ability. As data sets have grown in size and complexity, direct "hands-on" data analysis has increasingly been augmented with indirect, automated data processing, aided by other discoveries in computer science, specially in the field of machine learning, such as neural networks, cluster analysis, genetic algorithms (1950s), decision trees and decision rules (1960s), and support vector machines (1990s). Data mining is the process of applying these methods with the intention of uncovering hidden patterns. in large data sets. It bridges the gap from applied statistics and artificial intelligence (which usually provide the mathematical background) to database management by exploiting the way data is stored and indexed in databases to execute the actual learning and discovery algorithms more efficiently, allowing such methods to be applied to ever-larger data sets.