CTE (Common Table Expression) is the new and interesting feature of SQL Server 2005.Now,CTE stores the result as temporary result set from inside a statement.CTE is used when creating tables on the fly inside a  nested select and doing recursive function.CTE can be used for select and DML statements.

For example:

use AdventureWorks

go

with MyCte( ListPrice , SellPrice) As

{

            select ListPrice , ListPrice * .95 from Production.Product

}

select * from MyCte

Hi shaikh,

Take the reference of this article.
http://www.c-sharpcorner.com/UploadFile/skumaar_mca/CTE200509142009094057AM/CTE2005.aspx