Decanting wine involves, quite simply, pouring the wine from its bottle into another container (sometimes a fancy crystal decanter, often a simple carafe, but potentially anything at all, even an empty water bottle). But why do people do this? Is it putting on airs, or are there sound reasons for pursuing this practice?
In previous centuries when wine was unfiltered, decanting was a method of leaving the naturally-occuring sediment behind in the bottle and taking only the clear wine. Today, most wine is filtered; generally only unfiltered wines, aged full-bodied reds (more than 10 years old), and vintage port will have enough sediment to require decanting to remove it. Some white wines throw tartrate crystals ("wine diamonds", sneff says they're also called) that look like sugar at the bottom of the cork and sometimes at the bottom of the bottle; these are heavy, harmless and tasteless and so don't need to be removed by decanting.
A second, and more compelling, reason to decant wine is to let the wine breathe, as wine-lovers call it. Although too much oxygen is bad for wine, a little helps soften and mellow its flavour. This is particularly true with young rough red wines, which can contain tannins that make the mouth pucker and even sulphurous tastes that will dissipate after a short exposure to air. Decanting doesn't much improve thinner, more delicate reds like pinot noirs, or zesty whites like rieslings or sauvignon blancs, but it does benefit fuller bodied reds and whites, particularly those with oaky tones - think cabernet sauvignon, zinfandel, barolo, bordeaux, shiraz on the red end of the spectrum; oaky chardonnays on the white. Half an hour of decanting will allow such wines to open up and attain their peak flavour and aroma. That's also why people swirl their wine in the glass in a restaurant: to aerate it slightly to speed the breathing process.
Here's what you'll need to do to decant wine like a pro:
First, make sure you have a clean glass vessel big enough to hold your bottle of wine. If you're going to invest in a decanter, make sure that it's comfortable to use. Glass decanters with narrow mouths and very wide bases seem quite popular these days, but many have flat bottoms that are difficult to tip and pour from. Better models have an indentation in the bottom that you can put a thumb into as you pour, allowing a much more secure grip: you don't want to drop it and smash your glass and lose the precious elixir you're trying to enjoy. So, when buying a decanter, hold it in your hand in the store and tip it to see how it feels, preferably with water in it so you can get a sense of what it'll be like to pour from. The one I use is just a jug with a handle: not elegant, but easy to use.
Half an hour before you want to enjoy your wine, open the bottle and pour it into the decanter. Don't worry about pouring smoothly or slowly: just splash it in there! Then try a little taste test: have a sip of wine from the decanter every ten minutes, from the time you first pour it out, and see if it changes in taste. A discerning palate will notice when the wine begins to open up and taste smoother and more full.
If you are decanting a wine or vintage port with sediment, the process is a bit more complicated. First, make sure that the bottle has been sitting upright for at least 24 hours to allow the sediment to settle to the bottom. (You should store wine on its side to ensure that the cork doesn't dry out and shrink and cause the wine to oxidize.) Position a light on the other side of you and bottle/decanter (romantics will use a candle, but a flashlight works better) pointing towards the neck of the bottle. Slowly and steadily pour the wine into the decanter until you see the sediment rising in the bottleneck; discard what's left in the bottle. Be sure to handle the bottle gently and once you've begun to pour, don't stop, or you'll mix the sediment in with the wine.