Before I answer that, let me say that knowing the difference between percentage and percentile is extremely important for any competitive exam that you plan on appearing for and hence I will be highlighting that first before discussing the definition of percentile.
Percentage is what we have been calculating our entire lives. It is absolute.
Percentage = (your marks/total marks) x 100
For example, if in an exam of 100 marks, you scored 90, then your percentage would be 90%.
Basically your percentage is irrelevant of how the other students have fared in the same exam and it is just a reflection of how well you did individually.
However, percentile is a little different as it is relative. Here the scores of the other students in the same exam is very important to how we calculate a person’s percentile as it gives you the idea of how good/bad you did in an exam.
If I had to summarize percentile in a formula (which will help you calculate the same for any competitive exam that you need),
Percentile = (number of people behind you/total number of people) x 100
For example, if in a class of 100 students, you topped the exam. So what this means is that your score is better than 99 people and hence your percentile is 99%ile. Again, if your rank had been 30th, that means your score is better than 70 people and hence your percentile is 70%ile.
Thus in percentile, the number of people whose score is below you or the number of people your score is better than is your percentile.
Hope this helps.