A backlink is an incoming link to a website or web page. In basic link terminology, a backlink is any link received by a web node (web page, directory, website, or top level domain) from another web node. Backlinks are also sometimes called inbound links, inward links, incoming links or referring links. Their basic function is to serve as a citation or reference indicating that the linked-to page or site exists and can be accessed by clicking on the link.
Most search engines use the number of backlinks that a website has as one of the most important factor when determining that website's search engine ranking, popularity and importance. Google's PageRank algorithm uses the quantity and quality of inbound links as well as other factors like outbound links and relevancy to determine which websites should receive higher rankings.
The process of creating backlinks is called "link building." It is an essential part of Search Engine Optimization (SEO). Link building can be done in many ways, such as writing articles and blog posts that include hyperlinks to other websites, posting on forums and discussion boards with your website's URL in your signature, submitting your website to online directories, and more.
There are both good and bad ways to build backlinks. The good way is to create high-quality content that other people will want to link to. The bad way is to buy Links or participate in so-called "link farms.