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The process of reducing the spacing between certain pairs of letters to improve their appearance. When a font is created, each character is given a width that includes some space around it so that the letters don't run into each other when displayed or printed. This can be thought of as an invisible box around each character. Some pairs of characters such as A and V, look better if the boxes overlap slightly, bringing the characters closer together (but still not touching).
See also tracking, leading.