The Pathauto module creates automatic path aliases for nodes, users, and category terms, eliminating the need to create them manually. This way, your site is more user and search engine friendly, and more descriptive about its content with less work from your side.
Module download page: http://drupal.org/project/pathauto
This module requires: Token to be enabled
Administer > Configuration > Search and Metadata > URL aliases, in the "Patterns" tab.