Jutsu

Jutsu, or skills/techniques, are the mystical arts a ninja will utilize in battle. To use a jutsu, the ninja will need to use their chakra. To perform a jutsu, the ninja will bring out and release the two energies of chakra. By forming handseals, the ninja is able manifest the desired jutsu. Because of the extensive number of hand seals and different combinations, there are thousands of potential jutsu to be discovered.

The Basics
There are three types of jutsu: Ninjutsu, Genjutsu, and Taijutsu. There are also Kekkei Genkai abilities which aren't jutsu, but inherited abilities passed down through certain clans (however, they can be used as base for certain jutsu, such as Haku's Demonic Ice Crystal Mirrors). Their is also a fourth type of jutsu called senjutsu. Jutsu can also be attributed to certain parts of the body. (eg. Dojutsu is Jutsu of the eye.)

To create a Ninjutsu, chakra needs to be manipulated within the body. The 2 methods of manipulating chakra is referred to as "Elemental manipulation" and "Spatial manipulation". Elemental manipulation deals with changing normal chakra into one of the 5 basic elemental chakra. Spatial manipulation deals with controlling the shape and potency of chakra. These 2 methods can be implemented separately or together in order to create a jutsu. The series hints of a 3rd method of manipulating chakra ("Yin & Yang manipulation"), though it has yet to be revealed. The general term for the exact molding and proper manipulation of chakra is "chakra control".

As an in-between stage, some ninjas can partially control their chakra. This means they can use their chakra, but not effectively control it, which results in poorly executed justus, and more importantly, running out of chakra early in a fight. To manipulate their chakra more easily, hand seals can be used. With these hand seals, users can control their chakra with higher efficiency, allowing them to execute their jutsu more effectively. Different jutsus require a different hand seals.

Ranks
Depeneding on the difficulty or skill necessary to perform a jutsu, they are ranked differently. There are six different ranks in jutsu: Kekkei Genkai and other unique abilities of users do not have a rank.
 * E-rank - Academy student level: E Rank Jutsu are learned by Academy Students which are the basic and most fundamental Jutsu for all graduating ninja. (e.g. Clone Technique & Transformation Technique)
 * D-rank - Genin level: D Rank Jutsu are Genin level technique and can be achieved by all Genin, though many ninja only learn their "type" of technique. (e.g. Earth Release: Double Suicide Decapitation Technique)
 * C-rank - Chunin level: C Rank Jutsu are based on Chunin level technique though some Genin, like Sasuke Uchiha, can perform this and some Chunin cannot. (e.g. Fire Release: Great Fireball Technique)
 * B-rank - Jonin level: B Rank: B Rank Jutsu are Jonin level technique but Naruto can also perform this technique, emphasizing his determination and high chakra levels. (e.g. Shadow Clone Technique)
 * A-rank - Kage level or Jonin level: A Rank Jutsu are Elite Jonin level and up, even including some Forbidden Technique. The Chidori and the Rasengan, mastered respectively by Sasuke and Naruto, are A Ranked Jutsu.
 * S-rank - Secret, extreme level: S Rank are Secret, high class level technique. Techniques of this rank are mostly known to only 1 or 2 ninja and are often forbidden.

Jujutsu
Jujutsu (呪術, Curse Technique or Sorcery) is a form of kinjutsu that allows the user to envoke religious powers of Jashin to curse the opponent into torturous pain and death. It may also relate to a certain experiment that grants immortality. Unlike conventional jutsu, Jujutsu is not initiated by hand seals; rather, the practitioner makes use of ritual-like preparations, with the opponent(s) often the one(s) acting out the role of sacrifice, whether they like it or not. The only known practitioner is Hidan, and his only known technique is Sorcery: Death Controller Possessing Blood.

Kinjutsu
Kinjutsu (禁術, Forbidden Technique) are techniques that are forbidden to be used due to their lethal side effects or violation of the laws of nature (for example, ressurection of the dead). Orochimaru primarily used these in his quest to achieve immortality, but other jutsu in the series have been legally forbidden to use, such as Naruto's Wind Release: Rasenshuriken, effectively making then kinjutsu.

Fūinjutsu
Fūinjutsu (封印術, Sealing Techniques) are types of jutsu that seal things into objects or people, like sealing the Kyuubi into Naruto, or the Ichibi into Gaara.