short-interest tells you how much stock has been sold short as a fraction of shares outstanding, reported with a lag. Utilization tells you how much of the available supply is used, updated daily by lending desks. A stock can have modest short interest and 98% utilization if very few holders make their shares lendable.
High utilization is what precedes rising fees and a share-recall. It is the plumbing variable that turns a crowded short into a forced one.
Example: 40M shares are in lendable programs and 39.2M are lent, a 98% utilization. The remaining 800,000 shares are the entire supply available to new shorts in a stock trading 12M shares a day.
Related: hard-to-borrow, borrow-fee, short-interest, share-recall, securities-lending