"Tethering" is when you connect your PC, Mac, etc. to the Internet through your phone's cellular (3G, 4G, etc.) data connection either through a USB cable or by having your phone create a WiFi Hotspot (like a WiFi router). I guess that most of us are only interested in the WiFi Hotspot (not USB) type of tethering. WiFi Hotspot tethering is the rough equivalent of turning your phone into a DSL or cable-modem WiFi gateway, except that the Internet connection is the phone's cellular data connection (not DSL or cable).
I used to use FoxFi for free WiFi Hotspot tethering, but several months ago they were acquired by a company that now prevents the FoxFi app from working. They want to sell you their "PDANet+" app. The free version of PDANet+ has a data limit, which (in order to annoy you to buy the app) turns off the data stream and makes you turn it back on again.
I've been using the free app called "WiFi Tether" by Muller, Lemons & Buxton. I use version 3.1-beta-1 and it works well. I can't vouch for the
current version that's on the Play store (3.2-beta-2).
If the version on the Play Store doesn't work then you can find other versions on the website of the open source project.
android-wifi-tether - Wireless Tether for Root Users - Google Project Hosting
The only slight downside to the aforementioned "WiFi Tether" app (by Muller, Lemons & Buxton) is that it only implements a Hotspot in "peer-to-peer" mode rather than "infrastructure" mode. I'm no expert (and you can find info on the web) but from what I've read, as far as most people are concerned peer-to-peer mode is fine-- especially if you're only connecting 1-2 PCs to your phone. But if you were to use your phone as a Hotspot for several PCs, "infrastructure" mode would provide more efficient utilization of the phone's data connection.
I recently searched hard for a
free hotspot app for the Optimus S that can do infrastructure mode (and I downloaded several of them because they seemed to indicate that they provided hotspot capability), but I haven't found one. All of the "free" hotspot apps basically just opened the built-in Android hotspot, which requires you to pay Sprint (I think $30/month).