The defragmentation process searches your disk partitions and makes sure that the stored files are in one contiguous piece which results in better system performance. If you want to maintain your file system then the easiest and perhaps the most important way is that you should routinely defrag your drives. The windows 7 has improved disk defragmentation utility which gives users more control over defragmentation tasks. The most important features of Windows 7 defragmenter is that it lets you safely terminate the defrag process any time without any adverse effect and can defrag multiple volumes at the same time.
Note: Also check out a 3rd party advanced tool called Auslogics Disk Defrag, it is much faster and performs better.
Lets explore how to do it in Windows 7. Launch it from Start > All Programs > Accessories > System Tools > Disk Defregmenter.

By clicking Defragment Disk you will be able to start defragmentation of the disk. You can also schedule the defragmentation process by clicking Configure Schedule. Specify the Frequency, Day, Time and Disk and click OK to configure scheduled defragmentation.

Once defragmentation is complete, you will be able to see considerable change in your system performance. Enjoy!
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