Unit testing refers to testing individual units or components of a Node.js application using frameworks like Jest, Mocha, and Chai. Tests reduce bugs, allow safe refactoring, and give confidence. Popular frameworks include Jest, Mocha, and Chai. Unit tests should test isolated parts of a program, be fast, isolated, repeatable, self-validating, and written before code. Async behavior requires adding a callback to wait for asynchronous functions to complete. Tools like Sinon can stub dependencies to avoid external connections during testing.