Probably the best write-up on autotest I've seen out there:
DRY up testing in Rails with Autotest: "Autotest runs your tests automatically whenever your files change.
As Rails developers, we've been trained hard to test early and test often. We are also acutely aware of the DRY principle (Don't Repeat Yourself). However, these ideas don't quite agree in Rails because in our test-code-test cycle, we're constantly typing rake every time we need to run our tests.
Autotest will DRY up your testing by running your tests automatically whenever your files change."