I think that screencasting is recording of actions done on PC screen, but I am not sure. Am I right?
And if I am right, what is the best free software for it because I am a video editor and my friends want to know how I do it. I want to record it and show them.
OK !
Yes, screencasting is basically screenrecording. I'm into screencasting and here are my recommendations: Camstudio (open-source), which Tina already linked to. Screencast-O-Matic: High-quality web-based tool in case you're not planning on using it all the timeScreenr: Another high-quality online tool which lets you instantly share screencasts on TwitterTina already linked to this article which explains them in detail.
Osama,
which operating system are you using?
Below is a selection of MakeUseOf articles that may help you.
Windows
http://www.makeuseof.com/tag/camstudio-effective-screencasting-tool/
http://www.makeuseof.com/tag/create-simple-and-useful-screencasts-with-screencastle/
http://www.makeuseof.com/tag/5-free-screencasting-apps-for-creating-video-tutorials/
http://www.makeuseof.com/tag/4-tools-for-creating-screenshots-and-screencasts/
Mac
http://www.makeuseof.com/tag/quick-screencasting-using-quicktime-x-in-mac-snow-leopard/
http://www.makeuseof.com/tag/5-free-screencasting-apps-for-creating-video-tutorials/
http://www.makeuseof.com/tag/5-alternative-screen-capture-tools-for-your-mac/
Online
http://www.makeuseof.com/tag/how-to-create-share-screencasts-on-twitter-with-screenr/
http://www.makeuseof.com/tag/how-to-create-a-screencast-pro-6-free-online-tools/
http://www.makeuseof.com/tag/3-fast-easy-online-screen-capture-tools/
General Tips
http://www.makeuseof.com/tag/6-tips-getting-the-most-out-of-your-screencasts/
http://www.makeuseof.com/tag/how-to-make-a-great-how-to-video/
http://www.makeuseof.com/tag/screencast-manage-share-media-files/