Unlock Potential is an empowered state of being brought upon either by surviving drinking the Ultra Divine Water or Grand Elder Guru or Babidi drawing out a target's dormant power, thus allowing them to use their full potential at the time.
During the King Piccolo Saga, Goku has his potential unlocked fully by drinking the Ultra Divine Water, causing him to be able to use his Great Ape form's power in his base form, effectively permanently merging the two forms.
Much later, during the Namek Saga, Krillin and later Gohan both have their potential unlocked by Grand Elder Guru, greatly increasing their power.
Later still, Babidi displays the ability to draw fighter's abilities beyond their limits after he takes control over them, resulting in their veins bulging to the surface of their skin. Yamu, Spopovitch, and later Vegeta all gain this power up.
Due to functioning as an improvement to the user's base form, all people who achieved this state continued to use it for the rest of their participation in the series. Additionally, as displayed by Goku and Gohan, further transformations could be used on top of their Unlock Potential state, such as the Super Saiyan line of forms.
Video game appearances
The Unlock Potential form appears as a transformation for Kid Gohan and Krillin in several video games, including the Budokai series.
In the video game Dragon Ball Z: Super Saiya Densetsu, Yamcha, Tien, and Chiaotzu can all get their potential unlocked by Guru if they survive to Namek. In Dragon Ball Z: Budokai 3 Goku and Piccolo can also have Guru unlock their potential, but this is just a minor plot point in the Namek Saga and is not actually reflected in-game.
The Resurrection ‘F’ Pack DLC of Dragon Ball: Xenoverse allows the Future Warrior to take on Old Kai as a Master in order to unlock the Future Warrior's potential, giving the Warrior access to the Unlock Potential ability.
"The ordinary range for Attributes is 1-100, but as you've visited Guru, this range has been expanded to 1-125."
— Dragon Ball Xenoverse 2 Unleashing Potential Tutorial description
In Dragon Ball Xenoverse 2, a time rift forms around Guru's house on Namek. While investigating this anomaly, the Future Warrior (Xenoverse 2) can help Nail defend the Namekian Dragon Balls from Frieza's invading army. If they are diligent in their defense of Guru's house, then they will be allowed to meet Guru who will use his power to unlock their potential which will increase their attribute point limit from 1-100 to 1-125. This increase is just a stat upgrade and is not considered a transformation in Xenoverse 2. This status increase is called Unleashing Potential in its Tutorial description.