In baking, tempering refers to slowly adding a hot liquid to a cold liquid to balance out the temperature.
When referring to chocolate, tempering is similar to tempering steel -- it consists of heating the chocolate above 100 degrees (Fahrenheit) until fully melted, then cooling a portion of it below 85 degrees, and then heating it again to 90-95 degrees.
When properly tempered, chocolate holds a nice shine, won't "bloom", and holds its shape nicely at room temperature. Chocolate used as a topping or coating should always be tempered.