A Retweet in Twitter is when you see a tweet you like written by someone else, and you want to share that tweet with your Followers.
For example, I saw this tweet from @Foodimentary about a marinara sauce factoid that I thought my audience would enjoy.
1. Highlight and copy the Foodimentary tweet
2. Hit the Reply arrow on the side of the box
When you hit the reply button, your Twitter stream will open up straight to your home box along with Foodimentary's name with the @ symbol attached.
What the @ symbol does is let Foodimentary see in their @replies box that you did a retweet of their tweet. This is nice because people like to see where there stuff has been mentioned. Helps you build goodwill with others.
3. Paste the Foodimentary tweet
4. Add the letters RT which stand for Retweet in front of the @name. It is important to add the letters RT because it gives credit to the original source of the tweet, and communicates to your audience, "Hey guys, here's something cool I saw and wanted to share." It also tells Twitter that your tweet is Retweet and not a continuation of a conversation.
It is also important to make sure there is a space between the letters RT and the @Foodimentary name. If the RT and @ are butted up next to each other, the @Foodimentary name cannot become a live link again to let Foodimentary that you retweeted them.
5. Hit the Update button, and now the Retweet will show up in your Twitter stream, and in Foodimentary's @replies stream.
A common faux pas newbies make is simply copying someone else's tweet, going back to their home page, pasting the tweet in their home box, and then hitting the update button with no addition of the RT or the person's @Twitter name.
This makes the tweet appear like you are the original source/creator of the tweet which is not the case. It appears that you are plagiarizing someone else's tweet which is not a way to build goodwill.
It's always a good rule of thumb to be generous with praise and to give credit to other people's work again helping you build goodwill with others and in the Twitter community as a whole.