Ray tracing is an algorithm that synthesizes an image from a geometric scene. It works by shooting (tracing) rays from an observer position into the scene, checking for intersections with the scene's geometry. One of its particular strengths is the ability to accurately display mathematically described surfaces, like spheres or other implicit surfaces.
The idea for the Ray Tracing algorithm dates back to the ancient Greeks, who believed that vision was produced by "rays" shot off by the human eye, which "detect" the surrounding world. The first actual use of the idea in image production was performed by Albrecht Dürer, who used strings, tied to objects and a frame, to accurately project the objects geometry on a two dimensional plane. The first use in computer aided image generation is usually attributed to Turner Whitted, who released the first paper about the ray tracing algorithm in 1980. Since then the algorithm has been extended from a mere visibility detection algorithm (ray casting) to a technique for computing photo-realistic images and animations.