Simmering is bringing a liquid to the state of being just below boiling. You'll see lots of little bubbles forming and rising to the surface. If your pot begins to boil, turn the heat down to maintain that gentle bubbling. It is a cooking technique that can mean the difference between fluffy and burnt rice and between tender and tough stew meat.
How to Simmer
Simmering refers to a specific temperature range, and it's a gentle technique that's useful for cooking vegetables, soup, stews, and even large cuts of meat. In the culinary arts, to simmer something means to cook it in liquid at a temperature ranging from 180 F to 205 F (at sea level, the temperatures will be lower at higher altitude). With simmering you'll see bubbles forming and gently rising to the surface of the water, but the water is not yet at a full rolling boil.
You will often see a recipe instruction to bring a liquid to a boil, then reduce to a simmer. This ensures the liquid has come up to the proper temperature. You would then reduce the heat and keep the pot at a setting where there is only gentle bubbling.
When to Simmer
Simmering is usually used for things like cooking rice, where a boil is much too hot for the cook time. It's the ideal cooking method for making stocks because it's hot enough to break down the cartilage in the bones but gentle enough that it doesn't produce large bubbles. The agitation of a full rolling boil can disrupt the clarification process, leading to a cloudy stock. There's really nothing that needs to be cooked at a full rolling boil. Leave the agitation for the washing machine.
Simmering is also perfect for braising tough cuts of meat. The connective tissues in meat, which make some cuts of meat tough and chewy if cooked improperly, are made of a protein called collagen. But, when heated to temperatures between 160 F and 205 F, collagen starts to melt and turn into gelatin, which coats the muscle fibers of the meat and causes it to feel moist and succulent. Boiled meat, on the other hand, becomes tough and stringy, because the higher temperature causes the proteins to denature. Denaturing disrupts the structure of proteins, with one result being that they don't hang onto water molecules and another that they clump together, both of which can result in an undesirable change in texture.
Poaching vs. Simmering
While most casual home chefs have probably only heard of poaching in terms of preparing eggs, it can be used to cook other foods as well. A simmer may seem like what you need to correctly poach something, but a simmer is actually too hot. Poaching, by comparison, is a gentler technique, employing temperatures 140 F to 180 F. At this temperature, you may see small bubbles at the bottom of the pot, but no active bubbling. This makes poaching useful for cooking delicate items like eggs, which would break apart if there was excessive agitation.