Embedded OpenType (.eot) is a font format similar to TrueType, but with modifications aimed at a use on websites. EOT allows webfonts to be bound to a specific domain, so they are protected against a use on a different server. EOT fonts can also use subsetting and be compressed, so the size of the font file is reduced.
These are the tools currently available:
Convert TTF fonts to natively compressed EOT files using a simple Drag'n'Drop interface or via the Windows Command-Line. http://eotfast.com/
A Windows-only application that has not been updated since 2003: http://www.microsoft.com/typography/WEFT.mspx
A command line tool for Linux/Unix/Windows, but currently without support for URL-binding or compression: http://code.google.com/p/ttf2eot/
For code sample see this Wiki page: @font-face support in Internet Explorer