DPI stands for "dots per inch." In relation to a wireless mouse, it is related to the mouse's sensitivity. That is, the number expressed in dots per inch refers to the points that the mouse recognizes on a screen. With a higher DPI--the higher that number of recognized points--the higher the sensitivity of the mouse.
However, it is not necessarily always better to have a higher DPI. If this number is very high, the mouse could be excessively sensitive and therefore difficult to handle with precision. In the gaming field, on the contrary, a high DPI can be very useful. There are games that require high precision and, consequently, great sensitivity.  Many mouses allow you to set the DPI on them for optimal usage.