Crossfades are implementations of fades that smooth transitions between touching or overlapping audio regions.
To make a crossfade, select one of two (or more) overlapping regions and press [X].
Once the crossfade is in place, you can adjust the shape and width by dragging the boundaries of the regions and/or the fade handles with the Arrow Tool.
Generally, shorter crossfades work well for percussive material (e.g. drums, short guitar strums) while longer crossfades work on more resonant or sustained material (e.g. keyboards, environmental sounds)