What is Malolactic Fermentation?
Basically, malolactic fermentation is a secondary fermentation. It is the process of taking the harsher malic acid in a wine and converting it to a softer lactic acid. Malic acid is the tart acid found in a Granny Smith apple, while lactic acid is the more subtle acid found in milk, butter, cheese and yogurt (and it is the diacetyl derivative of the lactic acid, that shows up as "buttery" in a Chardonnay that has undergone malolactic fermentation). By converting malic acid to lactic acid via Lactobacillus bacteria, you end up with a wine that is more approachable and less abrasive on the palate.
Why Use Malolactic Fermentation?
While malolactic fermentation often happens naturally during the fermentation process, winemakers can determine to allow it to happen or prevent it from happening based on the stylistic results they are shooting for in the bottle. While a wine that has undergone malolactic fermentation is less acidic in nature, the trade off is that it will often have diminished fruit character. Some Chardonnay vintners are processing part of the blend through malolactic fermentation and preventing the remaining part of the blend from going through malolactic fermentation. Then they blend both batches together to retain the fruit character, while keeping the acidity down a bit.
This method has been a successful compromise in many popular Chardonnays where the malic acid lends complexity and the non-malolactic wine contributes solid fruit.