June 06 , 2012
A demat or DP or Dematerialised Account means that shares are held by investors in electronic form, not in physical certificates as was the case earlier. This makes record keeping much easier, and reduces chances of misuse or fraud. Share trading today almost exclusively happens in demat form only.
Typically, you open a demat account with any registered broker. DP refers to Depository Participant, which in your case would be the broker. You may end up paying a nominal opening or annual maintenance charge for this account. This then houses all the shares and derivatives you buy. This is distinct from a trading account you may open to actually buy and sell shares.