When something's in the air, it seems to be everywhere: everyone's thinking and talking about it. You could say, for example, that romance is in the air on Valentine's Day.
Celebration is often in the air at a graduation party, and danger might be in the air at an angry political protest. Excitement is usually in the air in an elementary school classroom, especially on the last day before summer vacation. When an emotion or idea is on everyone's mind, you can say it's in the air. This common phrase uses the "mood, sense, or feeling" meaning of air.