When you "back" a selection (be it an individual, a team, horse, dog or other), you are betting that it will win. This is just like betting with a conventional bookmaker.

When you "lay" it, you are betting against it winning. For example, if you're betting in a market on which team is going to win the Premiership and you lay Man Utd, then if they win you pay out. This is what bookmakers traditionally do.

On Betfair one can back a selection to win or lose, and what’s even more exciting, there’s in-play betting right through to the final whistle. A betting exchange is a bookie which uses technology and the market to make sure the customer gets a better price. It does that by reducing its risk, which means it doesn't have to build in extra margin as a safety cushion. The effect is that punters bet on the price they want, and not the price they're told they can have.