Facebook Connect is the next evolution of Facebook Platform – enabling you to integrate the power of Facebook Platform into your own site. Enable your users to seamlessly “connect” their Facebook account and information with your site. Find their friends who also use your site. And also, share information and actions on your site with their friends on Facebook.

With Facebook Connect, users can connect their Facebook account with any partner Web site using their simplified and trusted authentication. Facebook users represent themselves with their real names and real identities. Users can take their friends with them wherever they go on the Web. As a user moves around the open Web, their privacy settings will follow them, ensuring that users’ information and privacy rules are always up to date.

Update: You can also look at the video which shows you how to “Add Facebook Connect to Your Blog in 8 Minutes“.

Requirements: -
Demo: http://developers.facebook.com/connect.php
License: Facebook TOS