One of the most important and misunderstood concepts of baking is the ability to take a dough (which can be as simple as flour and water), and make it rise. This is done by a process known as leavening. The main purpose of leavening is to build the structure of the baked good. In other words, without a leavener of some sort, your baking will be very limited.
There are three basic categories of leaveners – organic, chemical, and physical.
I include all varieties of yeast in this category. Yeast is a tiny living organism that must be alive to do it’s job (hence the reason I use the term organic). It is very important to keep this in mind as you work with yeast. When learning how to work with yeast doughs, my mentor told me “treat it like you would treat a girlfriend, handle it gently, don’t slap it around. Keep it warm and well fed.” Although I’m not sure this is the key to a good relationship, it certainly works for yeast.
Yeast requires moisture, takes in sugars, reproduces, and gives off carbon dioxide. It is this process, when the conditions are just right, that makes breads rise. The ideal temperature for raising yeast is between 60 and 90F. Keeping the yeast cool is a process known as retardation. It won’t harm the yeast, but it will give you time to make your baking schedule a little more flexible. Using this process to your advantage, it’s possible to store dough overnight in a fridge without worring about it growing too rapidly. Yeast is destroyed when baked over at temperatures over 200F.
This category includes baking soda and baking powder. They rapidly rise a baked good when combined with moisture and heat. Baking soda also needs an acid. The chemical reactions that take place in the baked good produce gasses, which in turn make bubbles. Think back to grade school science fairs. There was always at least one baking soda and vinegar “volcano”. That’s exactly what goes on in your baking.
This category includes steam and air. Steam is released when moisture in a batter, supplied by butter, eggs, or another liquid gets heated. The steam forms air pockets and allows the baking to rise. Good examples of this are evident in choux pastry (for eclairs and cream puffs), and puff pastry. Air is also used as a leavener through creaming butter or whipping egg whites and carefully folding them into a batter. The air bubles get trapped and dried out as the product bakes in the oven. A good example of this would be a souffle.
http://straightfromthefarm.wordpress.com/2008/02/21/yeast-primer/ has some informative information on yeast.