My good buddy Josh Cunningham from JoshCanHelp.com swears by this free tool. Honestly, its use is beyond my capabilities, but if Josh loves it, you may as well.
This is about the best free web development tool I’ve ever seen. Go to the CSS Sprite Generator, upload all the images referenced in your CSS file, pick a few options, and hit submit. The site will not only generate the sprite image but it gives you the new CSS values as well. Talk about a time saver!
CSS sprites help your page load much faster by only accessing a single image (like the Google one above) instead of many. This only works for non-repeating images called as a background in your CSS file. For more info, see this A List Apart article and this Smashing Magazine post.