Snapping comes in three flavors: grid snapping, context snapping, and angular snapping.
In general, you turn a snapping mode on by pressing one of the buttons in the Snap toolbar, or selecting the equivalent functions in the Snap menu. The buttons are independent, you can turn them on and off independently. (The snapping modes, however, are not independent. See below for the precise interaction.) The keyboard shortcuts are rather convenient since you will want to toggle snapping modes on and off while in the middle of creating or editing some object.
Whenever one of the snapping modes is enabled, you will see a little cross near the cursor position. This is the secondary cursor Fifi.2 Fifi marks the position the mouse is snapped to.