Spanish has two past tenses: preterite and imperfect. 

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¿Cómo se forma el imperfecto?

To conjugate regular -ar verbs in the imperfect, simply drop the ending (-ar) and add one of the following:
-aba
-abas
-aba
-ábamos
-abais
-aban

To conjugate regular -er and -ir verbs in the imperfect, simply drop the ending (-er or -ir) and add one of the following:
-ía
-ías
-ía
-íamos
-íais
-ían

There are only three irregular verbs in the imperfect. You must simply memorize them.
ser          ir              ver
era          iba           veía
eras        ibas          veías
era          iba            veía
éramos  íbamos     veíamos
erais       ibais          veíais
eran        iban          veían

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¿Cuándo se usa el imperfecto?

Generally speaking, the imperfect is used for actions in the past that are not seen as completed.
It implies that the past action did not have a definite beginning or a definite end.
Las chicas hablaban en inglés. 
The girls used to speak/were speaking in English.
(no definite beginning or end)

The imperfect is used for... 

1.  Expressing actions that were repeated habitually in the past (“used to”). 
Cuando era niña, lloraba mucho.  
When I was a little girl, I used to cry/would cry/cried a lot. 

Almorzábamos juntos todos los días. 
We would have lunch together every day. 

2.  Actions that "set the stage" for another action.   
Yo leía cuando entró mi papá. 
I was reading when my dad came in.  

3.  Telling the time, date, weather and age in the past. 
Eran las tres de la madrugada.  |  It was 3 in the early morning. 
​Era el 7 de octubre, mi cumpleaños.  |  It was October 7th, my birthday. 

4.  Describing people and things in the past.
​Juana era muy alta.  |  Juana was very tall.  
La ciudad estaba en ruinas.  |  The city was in ruins.  
Estábamos felices.  |  We were happy. 

One way to determine if a verb is actually the imperfect is to try substituting one of the following:
was/were ...ing
used to ...
would (meaning "used to") ...

Modified from the original at StudySpanish.com.