Turid Rugaas has an awesome book & DVD out I'd highly recommend to all new dog owners.  It covers the basics.
www.dogwise.com  http://www.dogwise.com/itemdetails.cfm?ID=A251

By letting your dog know he's a superstar for offering up appropriate social signals on his own.. you will speed up their benevolent "communication" skills.

Signals like the "look away". It's actually a calming signal and or also referred as a "cut off' signal to help diffuse a tense situation.

"Look away" is universally known and even used by us! Normally the dog is trying to tell the other dog or human that they're overwhelmed, not interested, or sometimes simply telling US to calm down....sound familiar?

once you can recognize and reward your dog for displaying a signal that diffuses a situation, OR ask them to perform an incompatible or alternative behaviour; they begin to understand what the socially preferred behaviour is in that situation.

ie...with reactive dogs who normally lunge at another dog or person, doesn't really matter if it's overly excited, frustrated or fearful...if you work at a distance where your dog's body language is relaxed, then praise and reward them for 'looking away" or "coming to you" when called, you'd be reinforcing their INCOMPATIBLE or ALTERNATIVELY appropriate social behaviour.

REINFORCING the good stuff means they learn that their current schtick; growl, bark, jump, lunge, eyeball, inappropriate behaviours that get them in trouble, just don't pay off as much as their NEW much more calm and polite behaviours.
ie. being calm means they get to visit, if that's what they want...

Even something simple as reinforcing you'd prefer like; "happy eyes", low tail, relaxed fluid body movements, rather than having stiff, forward, alert, growlie, fearful or just plain frustrated body language.

Rewarding what you'd prefer they do, "OTHER" behaviour; anything that they offer up that is NOT forward movement meant to intimidate or is aggressive in nature, pays off.

REINFORCED behaviours grow STRONGER.

BIOFEEDBACK's also really HELPFUL! Think about WHAT YOUR BODY IS SAYING TO YOUR DOG...think about what you can do to help them figure out WHAT to do in stressful situations.

If you're stiff and growlie, or intimidating, then how can you expect your dog to feel relaxed, happy and not stressed?

You can help change their emotional state by rewarding:

1- soft eyes, slow blink
2-low tail,
3-loosey goosey playful disposition
4-look away, look down
7- tone of voice, even a change of bark from alert to happy
8-deep breath then relaxed out breath, or sigh
in the presence of "the stressor".

By reciprocating these calming or cut off signals we can communicate to them that they need to chill out:

1-slow blink our eyes
2-deep breath, sigh
4-look away, turn away, lower head
5-calm quiet voice
6-relax our body, move slowly and fluidly instead of abrupt and fast paced

It's helpful when you can find a DISTANCE where they're offering up these signals, making a situation that normally stresses them out into a situation they are now learning to calm themselves down.

REMEMBER to always stop BEFORE they become overwhelmed. Learn to notice when they begin to ramp up, THAT'S your cue that you should have LEFT by now.

Take note of HOW LONG you can work while your dog is able to REMAIN calm and relaxed. QUIT while you're ahead so the last thing your dog remembers about that situation is they were CALM and RELAXED.

ie.... George's cat encounter video...This cat literally jumped down from the tree in the middle of my front yard, JUST before George and I were going to do some fun "GO HOME" run to the door work.

It WAS crazy. LEASH slipped out of my hand....and lucky for me, I was just about to video our door work and in the heat of things I just kept video'n while I tried to take this opportunity and turn it around.

Here's me trying to make this CRAZY situation into a learning opportunity. It's not perfect as life never is, but there's happy ending. Anyways....

I rewarded all body language that showed me he was not going to lunge or start barking. Sniffing the cat is totally acceptable alternative to lunging at it or barking at it and it relieved the conflict of George not knowing what to do with this CAT who surprised us.

AFTER A STRESSFUL MOMENT ALWAYS NOTE what you could have done to make things easier. What did you do that worked and what just ended up fueling the situation.

HERE's my notes from the CAT vs George. Things I could have done differently.

1-my voice was high when I'm stressed, doesn't help George. I think it just adds to the anxiety
2-I repeated George's name...if he didn't respond the first time..it's my cue to try something else. He's too stressed.
3-letting the leash out, I should have u-turned into him the first opportunity to create that space then stop to work on rewarding him for "Other" behaviours that were NOT forward movement, lunging, barking like I did at the end.

*Dr. Patricia McConnell's book, 'For the love of a dog", "The other end of the leash" her dvd's are always a treat as well! http://www.dogwise.com/itemdetails.cfm?ID=DTB968

*Leslie McDevitt's "Control Unleashed" book & dvd's to watch her in action

*Emma Parsons "Click to calm" http://www.dogwise.com/ItemDetails.cfm?ID=DTB825