Good commits are crucial for maintaining a clean and understandable project history in Git. Characteristics of good commits include being atomic and focused, having descriptive messages, following conventional guidelines, being tested and verified, and being properly scoped. Conversely, bad commits are large and unfocused, have vague or misleading messages, combine unrelated changes, and contain incomplete or untested code. Best practices for good commits involve committing often but meaningfully, writing clear messages, using branches effectively, reviewing and squashing commits, and automating testing.