The battlegrounds were implemented for the improved PvP (Player versus player) system that Blizzard had launched into the game a short time beforehand. A battleground instance pits a team of horde and alliance against each other, each assisting their corresponding local faction. Battling often includes quests, and each battleground offers a unique game type, such as Capture the Flag, King of the Hill, and a Graveyard Capture style of battle.
Killing the opposing faction as well as completing the battleground gains you Honor Points (three times as much if you win the battleground), and the various quests as well as competing gives you reputation with the local faction associated with that battleground. These factions typically offer rewards in the form of weapons, armor, trinkets, and even mounts which can be purchased at various levels of reputation.
Honor also increases one's PvP Rank. Players begin at nothing, and the first few Honor Points promote one to a 'default' rank. To get to the next rank requires only a certain amount of honor points. From that rank onwards your ability to gain ranks depends on gaining more honor points than other people. Your standing is calculated in relation to others rather than assigning rank based on honor points.
This PvP Rank comes with many benefits. Like the factions which you fight alongside in the battlegrounds, your own faction makes available to you certain trinkets, items, armor, weapons, and even mounts for gaining a high enough PvP Rank. Because it is possible to lose ranks, especially at the more competitive upper levels, these items are befitting of those truely committed to PvP. If an item is purchased at a certain rank, and that rank is lost, the character can no longer equip that gear.The items sold are geared towards PvP and battle, and often include a good deal of Stamina and survivability bonuses.
Town raids and faction-versus-faction wars outside of the battlegrounds have decreased since the release of the battlegrounds, partly due to NPCs in towns labelled "Civilian". Killing these NPCs results in a "Dishonor Point" and counts negatively towards you. Much as honor kills are shared amoung the raid, so are dishonorable kills. This concept is very unpopular amoung PvP fans and veteran players.
Each major town contains "Battlemasters" which can remotely place you in the queue for a battleground of your choice.
 PVP Rank Calculations
As of patch 2.0.1 the PvP System has been revamped and the info bellow does not apply to it. It will be kept for archieving purposes.
The PVP system was introduced by Blizzard as a means for casual gamers to achieve Rare and Epic items without having to participate in time intensive High End Instances which require large raids of 20 or 40 players.
Unfortunately the idea backfired and the PVP Ranking system became even more time consuming than Blizzard could ever have imagined.
Here is how PVP Ranks are calculated.
Each time you kill a member of the opposing faction you receive Contribution Points(CP). If you are in a party, or raid, you will get CP if any member of your group participates in the killing of a player character. Every member of the group gets an equal share of contribution points regardless of what they are doing, as long as they are in range (the range appears to be around 30-40yd? Can anyone confirm?).
The CP awarded by a kill depends on your own PVP Rank, the PVP Rank of the person killed, and also how much participation you or your group had in taking down the player. For instance, if a person NOT in your group takes an enemy down to 10% health and you kill them by taking out the remaining 10%, the CP awarded to your group is less than that awarded to the person who did the most work.
Each week, on Tuesday Night at 2am PST, all realms go offline to tabulate weekly Honor, The calculations are complex and nobody has yet talked about how final honor is tabulated. However, once all the CP is determined for all players on a realm, the players are sorted by CP to determine the weekly standing. Eg the person with the absolute MOST CP that week earns a standing of 1.
You can view your last week's standing by opening up your Honor tab (default "H" key).
During the weekly maintenance, once your weekly standing has been determined, you are awarded "rating" points. The rating points awarded are determined by that week's standings. The person with the #1 standings earngs 13,000 rating points. A person of standing 80 or so will get around 8000 rating points.
Each week you lose 20% of your total Rating. This is what people refer to as the "Decay" of your rank. So if you have 10,000 Rating points in total, you lose 2000 for that week, and earn back whatever is awarded to your standing.
Obviously this means the HIGHER your rating the MORE you stand to lose. In this way, Blizzard forces you to play more and more each week in order to maintain your Rank or increase your rank.
Note also that your % progress (in the form of the blue coloured bar in the Honor tab) is actually a reflection of your Rating and its progression towards the Rating required to hit the next Rank.
If anyone knows the correlation between Standing and exact rating points plse let us know!
Ratings Result in PVP Ranks
PVP Ranks are entirely determined by your total Rating!! People who think that there are a set number of each Rank per server based on population are wrong!
For instance, the coveted Grand Marshal Rank is achieved when you can get 60,000 Rating Points (on most servers this will require hitting around 500k to 1million CP per week for 1-3 weeks once you hit Marshal or Field Marshal!!)
This is also how you lose Rank, since you lose 20% of your rating per week, if your standing for that week is insufficient to keep you at the Rating threshold you will lose your Rank.
 Alterac Valley
Related Alliance-friendly faction: The Stormpike Guard
Related Horde-friendly faction: The Frostwolf Clan
High in the hills of Hillsbrad lies Alterac valley, the first battleground. The object of this 40v40 battleground is to capture enemy territory and eventually to kill their racial leader. Stealing their graveyards will allow your units to spawn closer to battle, and destroying their armories and buildings will result in less support. Many sidequests and results from raiding include gaining special elite summons and more NPCs which you can turn in the various scraps and pieces found off dead enemy players.
Capturing a graveyard or destroying a territory isn't easy, many opposing npc enemies will be there to protect it. Some graveyards can be cleverly captured by having a team mate lure the guards away, perhaps 'kiting' them, while you steal the flag located at that position. Such an action requires uninterruption, and afterwards you will need to maintain a presense for your faction to claim it.
An easy method of gaining reputation in this battleground is looting an enemy player to recover some racial loot that they carry, which you can then turn in to you main town's NPCs. Your main town will also carry many other quests which you can do while fighting your enemies.
Teamwork is a large part of Alterac Valley; the sheer magnitude of the opposing factions makes it easy to think that your part is relatively small, when in fact it is as large as everyone else's. It only takes one person to leak through to destroy a building or steal a graveyard. Often guilds will join as a pre-formed raid group, ensuring teamwork. This method usually works better.
 Arathi Basin
Related Alliance-friendly faction: The Leagues of Arathor
Related Horde-friendly faction: The Defilers
The hills of the Arathi Highlands are home to Arathi Basin, a king-of-the-hill style battleground in which players must work together to capture, claim, and hold certain areas on the map.
Your raid group of 15 squares off against the opposing faction to hold as many points as it can for the longest, by any means necessary. If the opposing faction owns a 'site' you must claim the flag at that site and hoping that you aren't interrupted. The flag would then change to neutral, during which time you must keep a presence in the area. If left unchallenged, your faction will claim it. Teamplay is important as defending and holding a site works better with a larger number of people.
Quests for this instance also include finding abandonned supply crates.
 Warsong Gulch
Related Alliance-friendly faction: The Silverwing Sentinels
Related Horde-friendly faction: The Warsong Riders
Nestled in the foothills of southern Ashenvale lies Warsong Gulch, a capture-the-flag style battleground in which the opposing raid groups of 10 people battle each other in an attempt to capture the other's flag while defending their own.
Hidden in alcoves and houses along the way are special runes including speed and bloodlust. The graveyards for the respective sides are located high up in the base.
When carrying the flag the player cannot stealth, and will leave a glowing trail behind the flag. Very often players will take advantage of speed buffs either by runes, potions, or abilities to escape. A point is awarded when the enemy flag is brought to your own; if your flag has been captured, it must first be reclaimed.
Warsong Gulch tests teamplay and class roles in a unique way and is a popular small battleground.
 Arena Points Calculator
Pretty nifty tool to keep track of how your team is performing each week. Simply enter your rating or desired points and the engine will do the math for you