Very briefly, a blog (short for web log) is a collection of articles that you post online. It orders it so the most recent is always on top. The idea is to get people coming back to your blog regularly. As an author, this is not your personal diary about your cat and your trip to the beach and what you’re making for dinner. You want to stay on the topic of writing and on the topics that relate to your book. Posts do not have to be long and sprawling, and shouldn’t be. 300 words is good. You want to post at a steady rate. Don’t wear yourself out by posting five posts the first week and none the next. Your readers need to know what to expect.

Here is an excellent article on how to manage your time and ideas in blogging: 10 Tips to help you write your blogging butt off (Ink Rebels) *one of my favs*

There is some debate whether it’s better to have your blog on your website or on a separate service. If you decide to go the separate service route, as I have, here are some options:
WordPress.com: Not terribly intuitive but extremely flexible as far as layout. You can make your blog look like anything you want! Once you get the hang of it, it’s easy to use. Free.
Blogger.com: Extremely intuitive and user-friendly. Fairly flexible, but with some layout restrictions. Free.
Livejournal.com: Fairly easy to use, very restricted in terms of layout, but much more community centered than other blogger services. It’s more interactive with other bloggers. Free.
Typepad: I haven’t used it much myself. I think you have to pay for it.
Tumblr: You can only post one piece of media per post (ie. one picture with a caption or one video with caption). Great for visual books with photos to share. Free.

Other Useful Links:
3 Not so obvious things your blog needs (Open Forum)