Once your character reaches level 10, you can start to PvP in order to earn honor through Battlegrounds such as Warsong Gulch. Honor refers to the building up of points through PvP in order to gain rewards. Such rewards can be in the form of armor or weapons. Healing and Mana potions can be purchased with honor. You can even buy special PvP Mounts with honor. By participating in Battlegrounds, you also gain Reputation with the associated faction. Many Honor reward also need an specific Arena Rating to enable their purchase.
Honor can be earned four ways. Either through killing a player of the opposing side, or through accomplishing battleground objectives, or by completing PvP quests. Simply, each Honor Kill (or HK) rewards the player with a certain number of Honor Points based on the opponent's level, and how many players are assisting you.
When a Horde and an Alliance meet each other, they will sometimes fight or flee. On a PvE Server, players must flag themselves for PvP by typing /pvp, or taking an aggressive action against a player who is already flagged. On PvP Servers, this will automatically be the case for a player in Contested Territory, which is essentially the entire world except for the newbie zones and Shattrath City. When the opponent is killed, honor will be rewarded to the victor.
Honor can also be earned through participating in Battlegrounds. The victors (either Horde or Alliance) will earn a greater number of honor points than the loser, however, the losing side also earns a certain number of honor points just for participating and killing members of the opposing team. While in the battleground, you will earn honor for killing members of the opposing team (HKs) in addition to the honor you earn for participating in the Battleground. Also, while participating in Battlegrounds, your Reputation with the corresponding faction will increase. Some factions accrue Reputation faster than others, however.
If you win the Battleground, you will be given three Honor Tokens which can be turned in for rewards. If you lose a Battleground, you will only earn one token. Each Battleground has a different token type associated with it. You can hold a maximum of 100 tokens per type on your person, the rest will start to be mailed to you, and will remain in your mailbox for 24 hours.
Put quite simply, this is a new PvP-centric zone in Wrath of the Lich King. Lake Wintergrasp is not instance, is always available and is filled with npcs, mineral veins and herbs. There's several quests in there that involves the siege of Wintergrasp Fortress. Every 2 hours 30 minutes, the siege occurs and members of the Alliance and Horde must go and fight. Wintergrasp is possibly the fastest way to earn honor, but it isn't always available.
The last way to earn honor is through completing PvP Quests. Some PvP Quests are Daily Quests in which the quest-giver will ask you to enter and win a Battleground. Other quests might require you to go capture and hold territory, which may give your side (either Alliance or Horde) buffs, or give you tokens that may be turned in for gear. Any player of the opposing side that you kill will also reward you with honor. (You must be flagged PvP, if on a PvE server, to complete these objectives.)
Once you have gathered sufficient honor, you can turn it in for rewards. Most rewards require a combination of Honor Tokens along with Honor to purchase. There are many different types of honor rewards, including gear for each class, weapons, and mounts.