Howstuffworks "How Chocolate Works": "There are three basic things that must be done by the chocolate maker to make a chocolate bar:

Adding ingredients - The chocolate that we eat contains sugar, other flavors (like vanilla) and often milk (in milk chocolate). The chocolate maker adds these ingredients according to his or her secret recipe.
Conching - A special machine is used to massage the chocolate in order to blend the ingredients together and smooth it out. Conching can take anywhere from two to six days.

Tempering - Tempering is a carefully controlled heating process. According to this Chocolate FAQ, tempering is 'a process where the chocolate is slowly heated, then slowly cooled, allowing the cocoa butter molecules to solidify in an orderly fashion.' Without tempering, the chocolate does not harden properly or the cocoa butter separates out (as cream separates from milk). "