From BlenderWiki

Dynamic object type

Once activated, this gives your object real physics properties. Your object will now be pulled by gravity, bounce off other objects, have mass and be slowed by friction.

Actor

This causes the physics engine to evaluate your object, causing your object to be seen as more than part of the world (a simple wall or floor). This object can now be seen by other active objects.

At this point your object is not affected by normal physics (e.g. gravity) but is seen as more than just a background object. This is useful for interaction between objects that need not have physics properties, such as gravity, e.g. a button on a wall.

Ghost

Ghost gives the object the ability to pass through other objects. This helps save processing time while calculating objects’ physics (e.g. bouncing, friction, etc.). A collision with another object is still detected and reported to your game logic.

Invisible

If the object is set to "Invisible", it isn't rendered in the Game Engine.

Advanced

Collision advanced settings.

Mass

Mass affects the amount of force that is required to move an object. The greater the mass the greater the force that need to be applied to the object in order to move the object. Mass will not cause objects to fall faster or slower. To slow an object down use dampening, if you wish to accelerate the falling rate increase gravity (normal gravity is 9.81).

Radius

This determines the size of the bounding area for sphere bound objects and Fh/FhRot. This can be changed to a large or smaller size to give your object the look and feel you desire. The shape of the bounding area is determined by the Bounds button, by default it is a Box.

When changing the bounding size you can see the effect on the screen, in the shape of a circle. At this point in time all bounding shapes are reflected as a circle in the 3D window, even though they react differently during the game play.

No Sleeping

By default if an object that is affected by rolling physics comes to a rest, Rolling Physics is disabled. The physic engine assumes that it no longer needs to calculate the object’s motion. In some case this is true and will save you processing power, in other case such as in a soccer game, the physics needs to be maintained until someone kicks the ball placing it back in motion.

Damp

Dampening affects the freedom of an object to move. In space there should be almost no dampening, while in water the dampening should be set quite high.

RotDamp

Rotational Dampening is the same as dampening but only affects the object’s rotation. A high Rotational Dampening will not affect the rest of the object’s momentum.

Do Fh

This causes your object to interact with Dynamic Materials. This is currently not supported by the default bullet physics and is not fully supported in the Sumo engine in the current edition of Blender. It is fully supported by version 2.24 of Blender.

Rot Fh

This option causes the Z axis to be pointed away from a Dynamic Materials. This is activated by Do Fh.

Form

The Form factor gives you a degree of control over rigid body objects. The higher the Form factor, the less likely an object is to roll, especially rolling on a flat surface.

Anisotropic

This controls the direction of friction in the X, Y or Z direction of the object. Anisotropic is relative to the amount of friction in a particular direction. For example, take the wheel of a skate board, the forward direction should rotate easily, yet a sideward motion should be difficult and decreased by a higher level of friction.

Bounds

The Blender Game Engine has a number of ways of dealing with the shapes of objects. The reason that the game engine avoids highly accurate, per face object collisions, is due to the high level of processing power that it would demand. It is often faster, during game play, to uses a simpler system such as a box or a sphere for an object that’s shape is very similar.

The bounds are calculated from the object’s centre, which is designated by the pink dot normally at the centre of your object. It is not uncommon or useful to move this centre to a more convenient location. This can be done in the Editing context (F9) and choosing one of the 3 options that focus around Centre movement (see Mesh for more info).

Convex Hull and static Triangle Mesh are designed for uses with World objects floors, walls, trees, etc.

Blender has no generic way of interacting with hollow objects. An example, which would be difficult to create, would be a cup to shake dice in.