Calculating the average of percentages using Excel involves adding up all the percentages and dividing the total by the number of percentages you have. For instance, if you have a list of percentages in cells A1 to A5, you can use the formula "=AVERAGE(A1:A5)" in another cell to find the average. Excel automatically calculates the average of the numbers you specify within the range. This method is useful for analyzing data involving percentages, such as grades, financial performance metrics, or survey results, providing a quick way to derive meaningful insights from numerical data sets.