Unit testing involves writing simple tests that test tiny sections of code to confirm that it gives the correct answers in all cases. You often hear about it in connection with the term TDD; Test Driven Development. The concept is related to programming in general, not specifically to python.
Read up on it here:http://en.wikipedia.org/wiki/Unit_testing
Go through this set of tutorials if you want a little bit of experience in test writing:http://www.diveintopython.net/unit_testing/
I'm generally too lazy to bother with unit testing (as are many hobbyists), but at least I know what i should