The fold follows from Deleuze’s general development of a materialist metaphysics that holds the potential to differ as the original and ongoing movement of the cosmos. One term Deleuzians are perhaps more familiar with is actualization, which occurs when a single potential (singularity) is selected from the virtual and made concrete. To give an example, Darwinian natural selection is this type of selection, as it picks a genetic mutation but neither exhausts that particular potential nor prevents other potentials from being selected in the future. As Steven Jay Gould says, rewind and replay the evolutionary history of a species 100 times and you will get 100 different results.
In summary, Deleuze tends to make concepts: 1) open-ended and inexhaustive, e.g. always have the potential to differ and grow despite a certain consistency of operation (Holland calls this the “underdetermination of concepts”); 2) non-exclusive and unlimited, e.g. every application is creative, generative, and an ongoing process and therefore always allows alternate routes to be taken, as in every actualization enables counter-actualizations (cf. Deleuze’s preference of potential to the possible); 3) exist in exteriority to one another and are therefore infinite, e.g. a general rule of Deleuze’s metaphysics is that the relation between two terms itself is a third term, so there is nothing “necessary” or “intrinsic,” only determinants within differing sizes of infinitely.
The fold is Deleuze’s form of connection. One could contrast it with Althusser’s use of articulation, which is how he sometimes describes the connection between relatively autonomous levels of society (they articulate & dis-articulate). For Deleuze, all of the universe is a process of folding and unfolding the outside – which creates an interior that is not an inside grown autonomously from the outside world but merely a doubling of the outside (something he gets from Foucault, and cites AOK for, as well as “subjectivation”). Because subjectivation is a difficult example (the self acting on the self), the Leibnizian example of the house is perhaps simpler. But for me, there’s nothing better than the recent PBS documentary called Origami: Between the Folds, for Deleuze described the cosmos as “an origami universe” that follows a systolic-diastolic unfolding & folding whereby explosions of difference are followed up by selection and accretion, only to expand again. Or, to use the terms of Difference and Repetition, the universe expands by externally differentiating (laying out difference in the virtual plane of potential), internally differenciating by selecting an internal difference (concrete actualization through matter), and differentiates again. As an aside, this is also the movement of life, in particular organisms, which internalize small aspects of their milieu until they no longer need those aspects of the milieu to survive (think of organisms that internalize water regulation so they can explore land), which can be described as difference providing the becoming-unnecessary or becoming-independence of life.
Therefore, the fold is the form of connection that follows the general principles of a Deleuzian concept: open-ended & inexhaustive, non-exclusive and unlimited, exterior & infinite.