Why is Satan called the prince of the power of the air? And you were dead in the trespasses and sins in which you once walked, following the course of this world, following the prince of the power of the air, the spirit that is now at work in the sons of disobedience—among whom we all once lived in the passions of our flesh, carrying out the desires of the body and the mind, and were by nature children of wrath, like the rest of mankind. (Ephesians 2:1-3)


My understanding is that the apostle Paul is referring to Satan by "prince of the power of the air". Why would he be called that?
I would simply add to Mawia's anwer that the expression "the air" is a way of identifying the evil, sentient beings in the spiritual realm; namely, Satan and his minions, or demons.

The Hebrews believed in, and wrote about, three heavens, and in English we would call them "the firmament," "space," and "the home of God" (or "the highest heaven," as in "God resides in heaven," or "God is enthroned in heaven"; see Isaiah 6:1-7).  

Interestingly, the New Testament phrase "in the heavenlies" (or "in the heavenly realms") describes the believers' position or standing IN Christ.  We are seated in the heavenlies with Him by faith at the right hand of God (see Hebrews 8:1; 12:2).  Positionally--that is, in a judicial sense--believers in the eyes of God are IN Christ (see Ephesians 1:3,20; 2:6; 3:10; 6:12; and 2 Corinthians 5:17).

By contrast, Satan and his demonic forces, referred to variously in the New Testament as principalities, powers, rulers, authorities, world forces of darkness, and spiritual forces of wickedness in heavenly places (see Ro 8:38; Eph 6:12; Col 1:16; 2:15; 1 Pet 3:22) occupy, in a sense, the first heaven, although we see the evidence of their work vey clearly on earth, in and through people and perhaps even through some acts of nature (which we sometimes, perhaps mistakenly, call "acts of God"!).  

This evidence takes many forms, and not just in obvious ways such as violence, wars, genocide, widespread injustice, and sexual immorality, but also in not-so-obvious ways, as in godless ideologies and worldviews, corrupt and repressive governments, and much more.  

Fallen humankind has its own role in the creation and maintenance of wickedness, too.  We cannot claim as comedian Flip Wilson did years ago, "The devil made [us] do it"!  There is an expression "to be in league with the devil," which encapsulates quite well how both Satan (or the devil) and humankind each assumes a degree of culpability, though Satan assumes more, since he instigated the rebellion against God and exerts more influence than we do within the spiritual realm (see Matthew 18:7). Although Satan is a powerful enemy, we are not to fear him (2 Timothy 1:7; 1 John 4:4). We are also to resist him and even on occasions rebuke him in the name of Jesus (see 1 Pe 5:8,9; Jas 4:7; Jude 9).  

Moreover, Satan is well organized and systematic in his assault on anything and everything God calls good.  Aided by a hierarchy of demons under his control, the hallmarks of his cosmos--the lust of the flesh, the lust of the eyes, and the pride of life (1 John 2:16)--are evident in every society and culture in the world:  from the blatant consumerism and materialism of the minority world, to the oppressive political and religious regimes in the majority world, the latter of which are manifested in atheistic communism and radical Islam, for example.  

Satan is alive and well on planet Earth.  He is organized; his army of demons and unclean spirits is well staffed and well trained, with unwavering loyalty to their "prince; and his mission is clear:  to kill, to steal, and to destroy anything and everything that God has made or is in the process of building, including the universal church of His Son and of our Lord and Savior, Jesus Christ (John 10:10).  

Empowered both by Jesus' victory on the cross and by the Holy Spirit's empowering and channeling of the unwavering loyalty of God's ever-expanding family on earth, Satan is a defeated foe (see John 10:10; 1 John 3:8; and Revelation 12:10-12).

In conclusion, we thank God that Satan was dealt a death blow at the cross of Christ, which freed God to "wrap things up" by bringing history as we know it to a close in a way that is consistent with His eternal plan, the counsel of His will, and His holy, righteous, and just character.  In so doing, God will eradicate completely Satan's strongholds in the world and then usher in a new heaven and a new earth where righteousness will reign supreme, where sin will never again intrude, and where Satan will never again spoil what God has called good (see Revelation 20:10 and 21:1).