Follicular units are the naturally occurring groups of 1-4 hairs that are present in the human scalp. Each group also contains sebaceous (oil) glands, nerves, a small muscle and occasional fine vellus hairs.  The essence of Follicular Unit Transplantation is to use these individual, naturally occurring follicular units exclusively in the hair transplant procedure. This will accomplish a number of objectives critical to the hair restoration process.

In the last few years, an elite group of hair restoration physicians have and continue to revolutionize standard follicular unit transplantation, called "Ultra Refined follicular unit hair transplantation". Trimming smaller "skinny" grafts and making smaller incisions with ultra refined tools allows a hair transplant surgeon to dense pack follicular unit grafts even closer together, almost twice as much as standard follicular unit transplantation. Benefits therefore of ultra refined follicular unit hair transplantation include 1) Dense packing follicular unit grafts closer together when appropriate for the patient 2) larger single hair transplant sessions requiring fewer sessions for the patient 3) mininizing scalp trauma lessening the risk of "shock loss" of existing "native" hair.
 

From http://en.wikipedia.org/wiki/Follicular_unit_transplantation