All-purpose flour and bread flour can be divided into two types: unbleached flour, also called bread flour, and bleached flour. The main difference between the two is how the flour is processed. In order to make flour the wheat kernel is ground down into fine particles. The ground wheat has a distinct yellow color due to the presence of carotenoid pigments called xanthophylls. This pigment also gives a yellow color to potatoes and onions. At this point the flour is both oxidized to whiten the yellow color and matured. When flour is oxidized the gluten proteins present in the flour are altered. More specifically, the oxidation process enhances the formation of disulfide bonds between gluten proteins. These bonds make the flour more suited for baking, as it enables the flour to form stronger, more elastic dough.
Unbleached and bleached flour are whitened and matured by different methods:
Unbleached flour is matured and bleached naturally by oxygen present in the air. While this process is very simple there are some disadvantages. This method is somewhat unreliable and rather time-consuming, taking up to several months to complete. The flour also occupies space in the producer's warehouse while maturing. This storage expense is costly for the producer and makes unbleached flour more expensive than bleached flour.
Many decades ago, flour producers found that they could speed up the whitening and maturing process by treating flour with certain chemicals. The result is bleached flour. This process takes only minutes instead of weeks. However, the health risks surrounding the chemicals and bleached flour remain controversial. Many European countries ban the production of bleached flour. In the United States, any flours treated with these bleaching chemicals must be labeled as bleached.
There are several different chemicals that are used to bleach and mature flour. Benzoyl peroxide, chloride gas, and chlorine dioxide are all used to whiten the flour. Ascorbic acid (vitamin C) and potassium bromate are also commonly added to strengthen and oxidize the flour. Potassium bromate is a suspected carcinogen and has been banned from food in Europe, Japan, and Canada, but not in the United States. Only flours sold in California are required by law to label the addition of potassium bromate. Such flours are often referred to as "brominated".
The chemicals above are potentially toxic, but the safety of treated flour is heavily debated. Some people think that the chemicals only leave minor, if any, residues behind in the bleached flour. Others think that the remaining chemicals pose a more serious threat. Some people are even able to taste a bitter aftertaste from these chemicals. Additionally, using these chemicals is not environmentally friendly. However, don't be misled into thinking that unbleached flour is chemical-free. Many brands also use potassium bromate as a maturing agent. If you're concerned about these chemicals, I recommend purchasing organic flour or flour from producers that don't use these chemicals (look for unbleached flour that is also "unbrominated"). Fortunately, it appears that flour producers in the U.S. are phasing out the use of potassium bromate in favor of ascorbic acid, which is not a carcinogen.
There are other differences between unbleached and bleached flour besides the addition of chemicals. Surprisingly, the nutritional values of the two flours are practically identical. The main difference is that the chloride used in bleached flour destroys a small amount of vitamin E. This removal is considered by some to be negligible, since white flour only contains a small amount of this vitamin anyway. The two types of flour are generally interchangeable in recipes, however they have a noticeable difference in consistency. Unbleached flour has a higher level of gluten than bleached, and therefore it is preferred when making yeast breads and sturdier baked goods. Bleached flour has a lower level of gluten and a finer grain. It generally produces a slightly lighter and softer product than products made with unbleached flour. It is therefore more commonly used when making delicate pastries. Many cooks also use bleached flour in products where a white color is desired, as unbleached flour retains a more golden hue.
http://www.prosphora.org/page8.html
http://www.baking911.com/pantry_flour,grains.htm
http://www.ajc.com/living/content/living/food/goddess/0424.html?urac=n&urvf=10632132833820.4395733828574028
http://www.bread-bakers.com/archives/digests/v101n029.txt
http://www.solvayinterox.com/pdfs/techdata/IXP-03-001.pdf
Thanks to doyle for making my w/u stronger!