Tethering is connecting for example your iPad to your iPhone to get Internet on the iPad via the 3G on the iPhone.
Tethering can be handy if you have a wired broadband connection for your PC and if for any reason there is an outage - you can connect your iphone to your pc via usb and use the iphone as a temporary modem till the wired connection is back up.
fabs said:Now that could be handy.