Note: Since the time when this guide was written (2008), Google has drastically changed the way it interprets the nofollow attribute, so that nofollow is no longer useful for PageRank Sculpting. Therefore, I no longer recommend applying the tips in this article.
–John (December 2012)
PageRank sculpting is an SEO tactic that involves adding the nofollow attribute to links for which PageRank flow is not necessary.
PageRank sculpting is important because it helps stop your pages from giving away their PageRank unnecessarily. It is particularly beneficial for WordPress blogs, since they have a multitude of taxonomy/archive pages that can pull PageRank from the rest of your site.