Air is the substance that surrounds us, and which we breathe. I have been recently surprised at how little people actually know about air (like people in The Weakest Link, a quiz show, not knowing what percentage of air is oxygen). So I will ouline the basics of what is known as air.

Location
Air occurs in the atmosphere. In fact, the atmosphere is defined as the area around the planet that contains gases. For more on the atmosphere, you can go here.
Composition
The air is made up primarily of gases. It is almost entirely a mixture of nitrogen and oxygen, but contains other gases too, and also suspended dust and small organisms such as bacteria. The percentage of gases (and other stuff) in the air varies with altitude, location and humidity, and also on the particular time, as wind, for example, plays a part in determining the air's composition. Water vapor is the gas which varies most. In desert areas, water vapor may account for as little as 0.1% of the air, while in warm, humid zones, it may be as much as 6%. The higher up we go, the less heavier particles are found in the air, so the higher we go, the percentage of lighter gases goes up, and there is very little dust and particles. A typical composition of dry air is shown below.

Substance          | Percent (by volume)
-----------------------------------------
Nitrogen           |   78.08
Oxygen             |   20.95
Argon              |    0.93
Carbon dioxide     |    0.03
Neon               |   traces
Helium             |   traces
Methane            |   traces
Krypton            |   traces


Carbon dioxide does not make up a large proportion of the air, but it is significant. It is important because it is a greenhouse gas and helps contribute to global warming. It is taken out of the atmosphere by photosynthesis, and enters it by breathing, decay, and many human activities, such as industry and car exhausts. Carbon dioxide in the air has risen from approximately 290 parts per million by volume (ppmv) around 1900 to about 366 ppmv at the end of 1998. This is mostly due to human activities.
The molecular level
Air molecules take up only 0.1% of the volume they occupy. Thus 99.9% of air is actually a vacuum. There are 2.7 x 1019 molecules in every cubic centimeter of air, and the average speed of air molecules is about 500 m/s. Because of this, air molecules are constantly colliding with each other. Each molecule has about 5 collision every nanosecond!
Uses
The greatest commercial use for air is in obtaining the separate gases from it. The major gases (nitrogen, oxygen and the noble gases) are extracted using fractional distillation. Before this, water vapor and carbon dioxide are removed, as they freeze at low temperatures (other gases liquify), and the solids would block the equipment.

Oxygen boils at -183ºC. It is the third most produced substance by volume in the US (after sulphuric acid and nitrogen). It is used mostly for metal manufacture, metal fabricating and health services.

Nitrogen is obtained at -196ºC. It is used primarily in chemical processing, electronics, as a freezing agent and in fertilizers.

Also produced by distillation are noble gases, most notably argon, which provides an inert atmosphere in metallurgy, as is used in neon lights. (Neon lights are not always made from neon. In fact, any gas which emits light when a current is passed through it works. Neon, specifically, emits an orange-red light, while argon produces a blue-green light.)

Sources:

  • http://www.usatoday.com
  • http://scifun.chem.wisc.edu
  • http://www.dep.state.pa.us/
  • http://www.ems.psu.edu