Bentonite is a magnesium clay composed of very small particles, which makes this material extremely plastic. These fine bentonite particles stay in suspension in water, lending it to function as a suspending agent in glazes. Bentonite can also be used as a glaze thickener in small amounts, and can be a great way to thicken glazes if you do not want to use an organic compound (such as Veegum-T).
Adding bentonite to a clay body in small amounts -- about 2% -- will also add strength to green and dry clay, as it binds clay together strongly. Additionally, bentonite can increase the plasticity of a claybody, but this addition can also increase the shrinkage of a claybody. Bentonite can also decrease the drying rate. High quantities of bentonite, however, can result in an increase in cracking while drying due to the extremely small size of the particles, so make sure to test the percentage that you add to a custom claybody.
In addition to its functions in ceramics, bentonite is used in cosmestics, gas and oil drilling industries, as well.