One thing to note from the link Jeff gave, while it's a very good description of the situation, it doesn't make it clear that going round shrinking the db or log file size isn't generally a good idea unless you know that is is required.
The reason is that when the file fills up SQL has to increase the size of the file, and that process is quite intensive and can have a negative effect on the server. Generally in most situations it's best to leave it alone since after a while the space will be used, then cleared, then used again etc. The exception is where you've done a mass change to the database, like a large import or something, which has increased the filesize larger than it would normally be, in which case it's then worth reducing the size to where it would be normally.