Unit testing involves writing code to test individual units or components of an application to ensure they operate as expected. Unit tests act as specifications for code and help produce better, more readable and maintainable code. An effective unit test has one test class per code class, runs tests in isolation, has clear and descriptive names from a user perspective, and asserts a single outcome per test. Tools like mocking frameworks can help with unit testing by injecting dependencies and states. Unit tests should focus on testing logic and not user interfaces.