Enchanting is the process of using Enchant Weapon, Enchant Armor and Enchant Bow to improve an item of that type. While enchanting gear is not necessary, gear with enchantments are highly prized, especially hero level gear that is either single or double brilled.
Enchanting carries a price, however. One can either successfully enchant the item, adding either +1 hr/+1 dr (+2/+2 with a brilled enchant weapon), -2 AC (-3 AC with a brilled enchant armor) or +2 hit roll (+3 with a brilled enchant bow) respectively, the item can fade, explode, or nothing at all can happen. In the case of a successful enchant or a fade, the item will raise in level, depending on the level of the caster with respect to the item.
Enchanting items that already have enchantments on them appears to be more difficult, though much is governed by luck. While some items are easier to enchant than others, gear with armor class modifiers on them already, such as tank gear tends to be harder to enchant than items without, such as mana gear. Certain tank items are much harder to brill than others, eg. carved bone necklaces vs. gauntlets of silver.
If you worship certain Gods and Goddesses then the odds of successfully enchanting will change based on your deity's presence. Every so often while enchanting you'll see the message "You feel the presence of <godname>!". Depending on who you worship this can be a good thing or a bad thing.
There is also some speculation that the ingame day and month affect enchanting. It is believed that "Day of Sun" / "Month of Sun" is a beneficial combination. Anyone who can attest to this or other combinations please post your results below.
According to the Design Team (need to be logged in to view) the calendar has no influence on game mechanics.
The calendar currently exists independently of other story and mechanic-aspects of the game, without any influence or link.
In fact, the only variable that appears to have a slight influence on enchanting ability is the int statistic.