Do Follow Links

Today, quality backlinks are still the most important thing when it comes to getting your site to rank for your top (competitive) keywords. Links can come in many forms, but one of the key distinctions is between “Do follow links” and “No follow links”; a no follow link means that that link is not given weight (or is given much less weight) by search engines.

No follow links were invented a few years ago in an attempt to try to cut down on spam links. Better understanding no follow links can help you better hone your link building strategy and can help you get the biggest bang for your buck.
This video discusses some features of Do follow/No follow links as they pertain to proper SEO. This video features Matt Cutts, who is one of the senior developers at Google.