ESC is electronic stability control. I'll let anyone else chime in wit the full "what we know about it details, but here is the short version. There are 3 modes: On, a little off, and all the way off. For everyday driving, there is no need to have it off. With ESC on, for the price of stability control, you do experience a power cut during hard acceleration and hard breaking. I'm not clear on the difference between a little off (press the ESC button) and all the way off (hold the esc button for 10ish? seconds). The difference between ESC on and off is most noticeable launching the car from a stop. ESC on, drop the clutch at 2-3000 RPMs, it will feel like the motor is bogging, there will be a pause, then you will accelerate normally. ESC off, same thing, now you can smoke the tires all the way through 1st gear and beyond.

 

For the average driver, ESC off is sometimes used when bogged in snow/mud. For track use, it's sometimes flashed off and on by expert drivers. For most driving (track or street) it's left on for improved stability and traction control.