TDD is a software development technique that ensures your source code is thoroughly unit-tested as compared to traditional testing methodologies, where unit testing is recommended but not enforced. It combines test-first development and re-factoring (where, if the existing design isn't the best possible to enable you to implement a particular functionality, you improve it to enable the new feature).
TDD is gaining popularity as it allows for incremental software development - where bugs are detected and fixed as soon as the code is written, rather than at the end of an iteration or a milestone.
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