An entity-relationship diagram is a data modeling technique that creates a graphical representation of the entities, and the relationships between entities, within an information system.

The three main components of an ERD are:

• The entity is a person, object, place or event for which data is collected. For example, if you consider the information system for a business, entities would include not only customers, but the customer's address, and orders as well. The entity is represented by a rectangle and labelled with a singular noun.
• The relationship is the interaction between the entities. In the example above, the customer places an order, so the word "places" defines the relationship between that instance of a customer and the order or orders that they place. A relationship may be represented by a diamond shape, or more simply, by the line connecting the entities. In either case, verbs are used to label the relationships.
• The cardinality defines the relationship between the entities in terms of numbers. An entity may be optional: for example, a sales rep could have no customers or could have one or many customers; or mandatory: for example, there must be at least one product listed in an order. There are several different types of cardinality notation; crow's foot notation, used here, is a common one. In crow's foot notation, a single bar indicates one, a double bar indicates one and only one (for example, a single instance of a product can only be stored in one warehouse), a circle indicates zero, and a crow's foot indicates many. The three main cardinal relationships are: one-to-one, expressed as 1:1; one-to-many, expressed as 1:M; and many-to-many, expressed as M:N.

• Identify the entities;
• Determine all significant interactions;
• Analyze the nature of the interactions;
• Draw the ERD.