Blockchain technology enhances data security through its decentralized and immutable nature. By utilizing cryptography to secure transactions, it ensures that data cannot be altered retroactively without consensus from the network. Each transaction is recorded in a block linked to a previous block, creating a chain that is transparent yet secure. This feature makes it resistant to hacking and fraud. Additionally, data is distributed across multiple nodes, reducing the risks associated with single points of failure and ensuring greater data availability and integrity.