How can we find a good graph clustering of a real-world network, that allows insight into its underlying structure and also potential functions? In this paper, we introduce a new graph clustering algorithm Dcut from a density point of view. The basic idea is to envision the graph clustering as a density-cut problem, such that the vertices in the same cluster are densely connected and the vertices between clusters are sparsely connected. To identify meaningful clusters (communities) in a graph, a density-connected tree is first constructed in a local fashion. Owing to the density-connected tree, Dcut allows partitioning a graph into multiple densely tight-knit clusters directly. We demonstrate that our method has several attractive benefits: (a) Dcut provides an intuitive criterion to evaluate the goodness of a graph clustering in a more natural and precise way; (b) Built upon the density-connected tree, Dcut allows identifying the meaningful graph clusters of densely connected vertices efficiently; (c) The density-connected tree provides a connectivity map of vertices in a graph from a local density perspective. We systematically evaluate our new clustering approach on synthetic as well as real data to demonstrate its good performance.