Seo is pretty related with links to a site; i often met terms of inbound and outbound links, i read about that but still can't figure what is that and how it works. Can someone please tell me?

Thank you!

Yes, I am interested too about that. I have a tool which tels me how many inbound and outbound links my site has, but i am not pretty sure i understand what this means.

Inbound links are links coming to your site and outbound links are the links from your site to others. SEO established a few rules about this and generally all that matters is quality and sometimes the quantity.
Generally good inbound links are those from pages with related content, preferable with less outbound links and has a high PR. Still websites with a lot of outbound links and relevant to your theme will contribute to the popularity.
Now to what sites should you have outbound links? The answer is pretty simple: to quality sites, to appropriate and related ones.
As a conclusion you should take care with who you swap links, choose the best ones.

The more outbound links you have on your site, the less 'power' that page / site will have.

You are effectivly saying "look at someone elses site, not mine" because you are pointing to their site....you are in effect sponsoring it.

I recently redesigned a site that i maintain (I'm freelance). Notice that there are no links going to other sites, other than the google advertising (which is pretty standard on websites these days). However, I have over 2500 sites pointing to it, and the more sites pointing to it the better (with certain exceptions).
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Dave
SEO & UK Business directory