Chi

Chi refers to metaphysical energy or "life force" that flows throughout the body. In real life, Chi (or Qi) is a Chinese concept prevalent in traditional Chinese philosophy, medicine and martial arts. It is used in the Avatar Universe as a concept underlying Bending and the martial arts.

Bending
Chi is important in Bending, as the ability to bend seems to stem from a person's chi flow. A person's ability to bend may be dependent on the strength of his or her chi. Airbender Tattoos run along a person's Chi paths, which may be the reason an Air Nomad Avatar's tattoos glow when they enter the Avatar State. As Iroh showed in "Bitter Work", chi can be felt swirling around inside one's body, and the path can be changed to allow energy to flow in certain directions, which is the basic concept of lightning redirection.

Chi Blocking
Ty Lee has learned a special martial art, based on the legendary Chinese martial art Dim Mak, where she strikes the pressure points on a person's body, cutting off their Chi flow. Ty Lee employs this style and has defeated many opponents which would otherwise be stronger than her, such as the Terra Team in "The Drill".

Healing
Waterbenders have developed the ability to heal someone by using water to redirect the chi in a person's body, speeding up their healing process.