The Phase Rule describes the relationships between components, phases, and degrees of freedom in a chemical system. It states that the number of intensive variables that can be independently varied, like temperature and pressure, is equal to the total number of components (C) minus the number of phases (P) plus 2. The Phase Rule is derived from equating the number of equations, which is the number of components times the number of phases minus 1, to the number of variables in the system. According to the Phase Rule, each area of a phase diagram represents a bivariant system where both temperature and pressure can be varied without changing the equilibrium state.