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Firefox Private Browsing
Firefox added the option for private browsing into Firefox 3.5. The idea behind this mode is fairly simple. If you turn on private browsing, Firefox keeps your session hidden. Once you end the session, it will be as if you didn't do anything. There will be no saved searches, passwords or cookies and your download and history list will not have any new information in them. It will be as if you deleted your browsing history just for that specific session and left everything beforehand untouched.
Since this is a family-friendly website I'll skip over the most obvious reason that some people might want to leave no traces of their session. Instead, just imagine you were planning a surprise birthday party, vacation or proposal. If you just clear out your history, then you might miss something or you might clear out far too much information and make it obvious that you were hiding something. In this case, turning on private browsing would be ideal.
Note that Firefox private browsing is not some type of magic stealth browsing option. It is not a proxy, does nothing to hide your IP and will not shield your surfing from an angry boss. It just tells Firefox to not keep any information. All it does is effectively make a note of the time and then wipe out your temporary Internet files and history when the session ends. You are not any more anonymous while online and your experience online will be roughly the same, except the lack of long-term cookies will interfere with the features of some websites. If you're worried about what information websites record about you, then you should look into how to disable Google Analytics in Firefox.
If you save any files to your computer while in private browsing mode, they will still be there after you end the session. This is also true for bookmarks and anything else that is saved outside of Firefox's temporary files.
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Using Firefox Private Browsing
Turning on Firefox private browsing is quite easy. You can either press "Ctrl+Shift+P" or click on Tools in the Firefox toolbar. Click on Start Private Browsing to start a private session. You'll need to confirm that you really want to start a private session and confirm that your current tabs and windows will be saved and closed to start up the private browsing tab. Confirm that you want to start a private session and wake for the new browser window to open.
You can now browse privately for as long as you want. When you're done, just go into Tools again and choose to end your private browsing session. You should then be able to load up your old tabs and pick up where you left off.
Note that if you want to always browse privately, you can set up Firefox to always open with private browsing enabled. To do this, just go to Tools then click on Options. There's a tab in the options menu labeled Privacy. Click it and click on the pulldown menu. Click on the option for Use Custom Settings for History. There will now be an option to have Firefox always start with a private browsing session. Check the box and save the settings.