The default installation of Magento has two lines of footer links, one that you can edit from the CMS tab of your admin (under Static Blocks – Footer Links) so you can add links to your own content and one that is dynamically generated by Magento via a set of XML and PHTML files. It's a bit of a maze but for help on editing individual links on this second block follow
this tutorial.

I am quite happy with all the links but I don't like having them on two lines. I want them on a single line. You could change the CSS styles to display the two <ul> lists of links inline, but then there are specific classes for first and last links so you get nice dividers in between all links except the side ones. You could do a lot of hacking of phtml code but the easiest way to achieve one line of footer links is this:

Open skin/frontend/default/default/css/styles.css in any text editor and rename the class .footer LI.last to something else – I renamed it .footer LI.verylast. Overwrite the file on the server.
Now open your website in a browser and view the source. Copy the static code for the second line of links, the ones for the Sitemap and RSS. Basically you need everything between the <ul> tags but not the <ul> tags themselves.

Paste all these <li> tags straight into the Footer Links page in the CMS section of Magento's admin. Remember to rename the class for the last link (RSS by default) from "last" to "verylast" or whatever name you picked. This is so it doesn't display the white line at the end.
But now you have two sets of the same links! To remove the second, dynamically-generated set, you just have to go into the XML files as listed in the aforementioned tutorial (namely catalog.xml, catalogsearch.xml, contacts.xml and rss.xml) and comment out the whole reference to footer_links. Remember to always comment out rather than delete code, you never know when you might need it back. It’s good practise when commenting out to put a short reference like “Commented out by Brian on 06-08-2010”: you might think you will never forget the changes you have made, but you will, without fail.

That’s it done: one tidy line of links with all the dividers in the right place. Much nicer!