Since April, Google has penalized webmasters for sites that contain a large number of ‘bad’ inbound links. This was done to discourage link-farming and spamming; a site with many low-quality links is driven down the search results.
A new ‘Disavow Links’ feature in Google Webmaster Tools is designed to get around the algorithm. Webmasters can manually enter links they want removed from their SEO score, allowing Google to consider their site on its merits.
Here’s a brief outline of how it works.