Bypass and decoupling capacitors are often said to be the same things especially in power supplies applications. Bypass capacitors are used to provide a separate path (low resistance path) for AC signals. In power supplies applications, bypass capacitors are used to provide a low resistance path to the ground for AC signals (noise). Noise is AC voltage so it will get short-circuit to the ground thus filtering the noise. You might have heard that capacitors blocks DC but not AC. This is somewhat true but since capacitors are not ideal components, their effectiveness at letting AC passes through will vary with frequency, type of capacitor, etc. Decoupling capacitors are used to create a local energy reserve for the devices near the capacitors. The reason they are often said to be the same things is because a decoupling capacitor will acts as a bypass capacitors. The capacitor will provide a local energy reserve and will also create a separate path to the ground for AC signals. To understand properly the bypass capacitors, we will look at the real model of a capacitor. Capacitors are not ideal and this will reduce their effectiveness at filtering noise (especially in high frequency). It is still recommended to use bypass capacitors where necessary since they reduce the amplitude of the noise. Below, we have the real model of a capacitor :
This model is important since the equivalent series inductance and resistance have an important impact on the capacitor behavior. The capacitor is actually a RLC circuit. Also, the capacitance, the equivalent series resistance and series inductance vary with frequency, temperature and voltage which will affect the frequency response of the RLC circuit. Most capacitors manufacturers provide on their website or in the datasheet the capacitor impedance versus frequency. Below, we have an example for 4 different general purpose ceramic capacitor. We can see that smaller capacitance capacitor will be better at filtering high frequency noise than higher capacitance capacitor.
The image below show the impact of the RLC circuit of the capacitor. The impedance before the self-resonant frequency is determined mostly by the capacitance. The impedance after the self-resonant frequency is determined mostly by the series inductance. The impact of the inductance appears in high frequencies. The equivalent series inductance has a big impact on the impedance in high frequencies.
Often, ICs manufacturer will recommend bypass and decoupling capacitors in their datasheet. If there is no information in the datasheet, we recommend using one or two 0.1uF ceramic capacitor and a 10uF ceramic or tantalum electrolytic per power pin. The 10uF is not necessary but will help filter lower frequency noise and provide a better decoupling than a 0.1uF capacitor.
The location of the capacitor on the printed circuit board (PCB) is very important. Bypass capacitor should be placed as close as possible to the pin of the integrated circuit. The length of the trace to the ground should be small. We recommend using a via connected to the ground plane with a very short trace. A via in the pad of the capacitor connected to a ground plane can also be used but you cannot do that with every type of via. You should verify with your PCB manufacturers if it is possible to place a via in the pad. If it is impossible to connect a via to a ground plane, you should optimize your board design to have the shortest and largest traces possibles to connect the capacitor to the ground.
The reason the traces should be kept as short as possible is to reduce the series inductance of the traces. In high frequency, the very small inductance of the traces will reduce the efficiency of the capacitor to filter high frequency noise. For lower frequency, it generally have a very small impact. Below, we have an example of the impact of placing the capacitor 300 mils from the IC power pin versus directly connected to the IC power pin. The results below were obtained through a quick simulation and may not be accurate. Lots of details were not included into the simulation (PCB material, ground plane, etc.) but this is just to give a quick idea of the impact of the capacitor location.
We can see that the capacitor placed directly at the IC power pin will be better to remove high frequency content than a capacitor placed 300 mils from the IC power pin. We have a difference of around 8dB in the high frequency range which is not negligible.