From BlenderWiki

Active Object as Pivot

Forget the name: it is not limited to objects. In Edit mode the active element can also be a vertex, an edge or a face.

In Object mode

What happens in Object mode is pretty simple: rotations and scalings happen around the active Object’s center. This is illustrated by (Rotation around the active Object), where the center of the active Object, an hourglass, is the only thing to remain still.

In Edit mode

It may seem like there is a lot of complexity to using the active element as a pivot point in Edit mode but, in reality, the many possibilities result of only a few rules:

• The pivot point is always at the median of the active element(s).
• The transformations occur by transformation of the vertices of the selected element(s). If an unselected element shares one or more vertices with a selected element then the unselected one will get some degree of transformation also.

Let’s examine the following examples: in each case we will see that the two rules apply.

Single selection

When one single element is selected it becomes automatically active. In (Edit mode and only one element selected), you can see that when it is transformed its vertices move, with the consequence that any adjacent element which shares one or more vertices with the active element is also transformed somewhat.

Lets review each cases:

• Faces have their pivot point where their selection dot appears, which is where the median of their vertices is.
• Fgons behave the same, but notice that the selection dot can be off compared to faces.
• Edges have their pivot point on their middle since this is always where the median of an edge is.
• A single Vertex has no dimensions at all so it can’t show any transformation (except translation, which is not affected by the pivot point…).

Multiple selection

When multiple elements are selected they all transform.

The pivot points stay in the same place as what we’ve seen above, with only one exception for Fgons. In (Edit mode and multiple selections), the selected elements have been scaled down from large to small:

• For Faces the transformation occurs around the selection dot of the active face.
• Fgons behave exactly like faces.
• Edges also keep the same behavior with their pivot point at their median.
• There is a case for Vertices this time: the active Vertex is where the pivot point resides. All other vertices are transformed relative to it.

Again, as we have seen, all there is to remember is the two rules:

• Pivot point at the median of the active element’s vertex or vertices.
• All selected vertices, directly or as part of a bigger element, e.g. a face, and only them are transformed.