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What does commenting on blogs do?

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Leaving a well written blog comment on websites makes you more visible to the search engines. The comments contain your targeted keywords, and search engines will associate those words with your website. Leaving comments on blogs with high passable page rank improves your search engine rankings for your keywords and domain name. Search engines also index these blogs and find links to your website - potentially increasing your page rank. Keep in mind that the link back to your site is more important than the comment.

What effect does this have on my site?
Blog participation is a good way to drive more traffic to your website. Blogs also provide another link to your website that search engines will find and count towards your link popularity.