1) Dielectrics increase the capacitance of a capacitor by introducing polarizable molecules between the plates that can be oriented by an applied electric field. This leads to an increased charge storage capacity and a lower operating voltage.
2) The dielectric constant is a property of the material that quantifies its ability to increase capacitance. It is defined as the ratio of the capacitance with a dielectric to the capacitance without.
3) Dielectrics break down at a certain maximum electric field strength, above which the material can no longer maintain its insulating properties and will conduct electricity between the plates.