The question asks us to identify which option best characterizes a material's chemical property.

- Chemical properties describe a substance’s ability to undergo changes that transform it into different substances.
- These properties involve chemical reactions where the material's internal structure is altered.

- Option 1: Its ability to conduct electricity – This is a physical property related to how free electrons move through a material without changing its chemical identity.
- Option 2: Its reaction with acids or bases – This is a chemical property, as it describes how the material chemically interacts and changes when exposed to acids or bases.
- Option 3: Its melting point – This is a physical property, describing the temperature at which the material changes state from solid to liquid without chemical alteration.
- Option 4: Its density – This is also a physical property indicating mass per unit volume, without any chemical change.

Therefore, "Its reaction with acids or bases" is the correct choice because it directly involves the material's chemical reactivity.

Reference: Principles of Chemistry, Volume 1, Chapter 3: Chemical Properties and Reactions, Page 78.