Best known as GitHub's commit-activity grid. Where a line chart answers "how much has this grown," a calendar heatmap answers "when did it cluster" — weekday habits (quiet on weekends), periodic spikes (end of month), or one unusually active day all show up just from where they land on the grid.
Color must be a sequential scale that only varies one hue's lightness — magnitude here is a matter of "how dark," not a different category. A rainbow-style scale that shifts hue instead of lightness breaks the ability to tell at a glance which of two adjacent cells is bigger just by looking at color.
Cells are small enough (a few pixels each) that reading an exact value normally requires a hover — the grid itself is for spotting roughly when activity ran high, not for precise lookups. And when comparing totals across months, account for the different day counts (28-31) — counting dark cells without adjusting for that skews longer months to look busier (or quieter) than they really are.
When to use
Use it to show when daily activity clusters by weekday or cycle. For precise value comparison or a short-range trend, a line or bar chart works better.