A varactor diode is a semiconductor device whose capacitance can be varied by changing the reverse bias voltage. It contains a p-n junction with a specially designed impurity profile that makes its capacitance highly sensitive to changes in the reverse bias voltage. The capacitance is determined by the permittivity of the semiconductor material, the junction area, and the depletion width, which varies with the applied reverse voltage. Varactor diodes are widely used for applications like parametric amplification, mixing, and voltage-controlled tuning due to this voltage-dependent capacitance characteristic.