When the pixels are so dense, that using the monitor at its typical viewing distance makes pixels indistinguishable. But not just in the sense that you cannot see that your view is pixelated, rather in the sense that packing the pixels any denser wouldn't make a difference.

Quality desktop monitors viewed at their typical distance do not look pixelated, e.g. you rarely are able to see individual pixels especially if proper antialiasing is used, but they do still almost always have a lack of sharpness that could be corrected with a denser display.

On retina smartphones, making the pixels denser wouldn't make the image look any sharper from a typical viewing distance. Once you achieve that, I'd say it's "retina-grade".