The first step to fighting vandalism is to patrol edits made by people. This option shows you the changes made by a user on a page. After viewing these changes, you can undo (and if you're a rollbacker), rollback edits.
In the recent wiki activity, there is a little button next to each edition. It looks like a page. If you click on it, you can view the person's edit. At the top of the page, the username/IP address of the user is given, with links to their talk page, contributions and, if you're an admin, you can see an option to block the user.
A link to undo the edition or rollback is also given, in case the edition was vandalism.
You can also undo or rollback edits directly via the user contributions page (but you can rollback only if the edit is the current version). These options are also available in the Special:RecentChanges or in the revision history of the page.
Now what do undo and rollback even do?
The option 'undo' reverts a single edit of a certain user. It requires confirmation, and appears in the Special:WikiActivity. It can be undone. The 'rollback' option, however, can undo all previous edits of a person without confirmation. A rollback does not appear in the wiki activity, but can be undone by visiting the recent changes or a user's contributions.
The right to undo is available to all autoconfirmed users, but only rollbackers can revert multiple editions with a single click.