The Adobe Character Panel

This is a tutorial on the Adobe character panel. Even if you don't use their software, this will provide useful advice for your design endeavors. The layout will vary from program to program and version to version, but the general idea is the same.

Font: Select the font that you would like to use, or type it in for faster results.
Font Size: For historical and practical reasons, this is not consistent from typeface to typeface. Don't expect your 12 pt. type to be 12 points in size!
Kerning: This is used to manually adjust the space between two letters. The word WAVE will need kerning if set in caps. W A and V are much farther apart than V and E.
Vertical Scaling: Stretches or compresses the selected letters vertically. Don't let a font designer catch you using this without good reason.
Baseline Shift: The letter(s) position relative to the baseline. Setting a letter to -1 pt would make it lower, 1 pt would be higher.
More Font Options:

• Faux Bold: Adds a synthetic bold look to the font. If Bold is available via font style, always use that first.
• Oblique: Skews the letters to give them an italic appearance. If you intend to practice philological typography, avoid this.
• All Caps: Sets the text to caps. When this option is used, increase your tracking for better legibility and a less vociferous feel.
• Small Caps: Sets the text to small caps. Capital letter will appear as regular majuscule (regular upper case), and the minuscule (lower case) will appear as smaller sized caps. This is prefered over making small caps by decreasing the font size to make small caps. When you do so, you end up with a minuscule with a thinner stroke than the majuscule. Unfortunately, this option is not available in all fonts. Also, this option will convert numbers to Old-Style Figures. This should be used on numbers in running text. Consider them the lower-case numbers.]If you want to be sure you're using a font with complete small caps, go with a "Pro" font (e.g. Minion Pro, Garamond Pro).
• Superscript, Subscript, Underline, and Strikethrough: the icons and/or names are self-explanatory.

Font Style: Changes the style of the font, this should always be used before "faux" options if applicable.
Leading: Referring to and pronounced like the metal lead, this number represents the distance between the baselines of two consecutive lines of text. The default is 1.2 times the font size (10 point font times 1.2 = 12 point leading). Often, you will see font size and leading written as 10/12.
Tracking: Similar to kerning, but sets the letter spacing for a larger group of text instead of between two specific letters.
Horizontal Scaling: Stretches the font horizontally. See warning in Vertical Scaling about usage.
Color: The color of the font. A sidenote: you might encounter someone speaking of the color of the textblock. This is an optical issue. A dense textblock would be considered to have a dark color, a loose textblock would be light. It is also said that some people can actually see color in certain texts. I'll believe it when I see it!