While there are different types of anti-aliasing in general, this technology works by sampling the pixels around the edges of an image. By using the colors that it samples, the technology blends away the appearance of jagged edges.

Should I have anti-aliasing on or off?

In short, you should switch Anti-aliasing on if you're trying to get the best possible picture that you can get, and you're playing a game in single player mode. If you want the best chance of winning a competitive game online, then turning anti-aliasing off is a good idea.

Is anti-aliasing good for FPS?

This setting reduces the aliasing effect on the images by essentially blending the colors at the edge, creating a smooth illusion. This blended effect does come at the cost of computing power and can often lower your FPS, especially if you have a lower-end build.