Tear a piece of paper into small pieces and spread them all over the room in a random manner. That’s how a file is normally stored on your hard drive.
The job of a disk defragmentation utility is to rearrange these fragments in a sequence such that the original piece of paper can be reconstructed in lesser amount of time thus speeding up your computer.
While your Windows already has a built-in disk defragmenter, you should also check-out a worthy alternative called Defraggler that just hit version 2. Defraggler sports a more appealing and informative UI and does some unique things as well.
The Microsoft tool that ships with Windows defrags the entire drive and the user rarely has a clue on what’s happening behind the scenes. Defraggler gives you control - you can just defrag the most fragmented files and folders without doing the entire drive. For instance, files like the Outlook PSTs become fragmented often and with Defraggler, you can target them directly for defragmentation.
Defraggler offers another unique feature where you can move all the large files that you don’t use often, like videos, program installers, etc., to the end of the hard drive. The logic is that Windows will then be able to access the frequently used smaller files faster as they’re at the start of the drive.
Contig is another utility from Sysinternals that offers similar features but it runs only from the command line.
Update: Defraggler is completely free though the download page may confuse some users. The links are available just below the credit card icons.