CSS sprites is the way to reduce the number of HTTP requests made for image resources referenced by your site. CSS Sprite Generator allows you to upload all of your images (you have to place them in a .zip file first) and it will combine the uploaded images into a single sprite and also generate the CSS for you.
Images are combined into one larger image at defined X and Y coorindates. Having assigned this generated image to relevant page elements the background-position CSS property can then be used to shift the visible area to the required component image. This technique can be very effective for improving site performance, particularly in situations where many small images, such as menu icons, are used.