Debian From Scratch (DFS) is a live bootable CD that is designed to provide a fully-featured kernel and a fully-featured rescue environment. The rescue environment contains filesystem tools, editors, C development environment, etc.
dfsbuild is the program used to create the DFS CD image. It is highly configurable and can be used to create other custom bootable CD or DVD images. You can use dfsbuild to do something as simple as building a DFS CD with a custom kernel. Or, you can customize the CD to include a completely different set of packages.
dfsbuild works by obtaining packages from your nearest Debian mirror. It will generate an ISO image that contains a bootable Debian system generated by installing those packages. Also, it can place all the .debs and files needed by cdebootstrap in the image. Thus, the generated image can be used to install the base Debian system on a PC as well.
On i386 and amd64 platforms, dfsbuild supports the Grub bootloader.
On Alpha, dfsbuild supports the aboot bootloader.
On PowerPC, dfsbuild supports the yaboot bootloader.