Shadow Clone Technique

Similar to the Clone Technique, this jutsu creates clones of the user. Unlike the Clone Technique, these clones are actual copies, not illusions. The user's chakra is evenly distributed among every clone, giving each clone an equal fraction of the user's overall power. The clones are capable of performing jutsu on their own and can even bleed, but will usually disperse after one or two solid blows. They can also disperse on their own. The clones will be created in roughly the same condition as the original.

Shadow clones can't be detected by the Byakugan because the clones have the exact same amount of chakra and aren't made from any other substance, making them indistinguishable from the actual person. In the anime, Sasuke Uchiha claims that the Sharingan can distinguish clones from the original, however various events throughout the series seem to indicate that this is not the case, implying that the Sharingan was merely used to keep track of the original's movements.

Uses
A characteristic that is unique to the Shadow Clone is that any experience the clones gain during their existence is transferred to the user once they are dispersed. This makes the technique ideal for spying, since the user can simply send a clone to spy on a target, then have the clone disperse itself without returning to pass the information back to the user. Any extra chakra the clone has when it disperses is also returned to the original.

It's also useful for training purposes, since the total amount of experience the user gains is multiplied by the total number of clones being used to train. For example, if a user creates one shadow clone and trains together with this clone for 1 hour, then dispels the clone, the user gains 2 hours of training in 1 hour by adding the hours of clone and the user together. This particular feature is not revealed until Part II by Kakashi Hatake. When done with several hundred, like Naruto does, training that could take weeks or months can be completed in a few hours. While the technique can be extremely beneficial, attempting to use multiple clones for training purposes can be mentally harmful to the user, as not only is all the experience collected by the user, but so is all the mental stress from training each clone.

Disadvantages
It's very gay.

Trivia

 * Twice in the anime, Naruto produced shadow clones using the tiger seal.

And not only selected in the list of users.
 * The Shadow Clone Technique, Used by all graduated from the Ninja Academy