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Kerning always reminds me of the sweet, buttery smell of freshly popped corn kernels but, alas, kerning has nothing to do with delicious popcorn. Kerning is the adjustment of space between two letters to create a more aesthetically pleasing visual result. Kerning is particularly important when using free fonts. The most difficult letters to kern correctly are those with a diagonally slanted side (think A, Y, V, W). These letters create a negative space next to them.

Tracking is similar to kerning but is spacing between letters of a whole word. Tracking is used to give a different look and feel to a body of text (think h e l l o ) or sometimes negative tracking is used to fit large amounts of text into a small design space.