OFDM divides a given channel into many more narrow sub-carriers. The spacing is such that the sub-carriers are orthogonal, so they won't interfere with one another despite the lack of guard bands between them. This comes about by having the sub-carrier spacing equal to the reciprocal of symbol time. All sub-carriers have a complete number of sine wave cycles that upon demodulation will sum to zero. So, the spacing of the sub-carriers is directly related to the useful symbol time (more specifically, the amount of time the transmitter spends performing IFFT). As the figure shows, there is 90 degree phase shift in the signals. Signals that are separated by 90 degrees are orthogonal to each other or in quadrature. Signals that are in quadrature do not interfere with each other. They are two independent components of the signal

Because of this relationship, the resulting sinc frequency response curves from each sub-carrier create signal nulls in the adjacent sub-carrier frequencies thus preventing inter-carrier interference (ICI).

OFDM is a form of frequency division multiplexing (FDM), which typically requires guard bands between carriers and specialized hardware with bandpass filters to remove interference. OFDM eliminates the need for these, which increases spectral efficiency and reduces cost and complexity of the system since all functions can be completed with digital signal processing (DSP).

Wi-Fi OFDM channelization is an example of this. Each 20 MHz channel, whether it's 802.11a/g/n/ac, is composed of 64 sub-carriers spaced 312.5 KHz apart. This spacing is chosen because 64-point FFT sampling is used. 802.11a/g use 48 sub-carriers for data, 4 for pilot, and 12 as null sub-carriers. 802.11n/ac use 52 subcarriers for data, 4 for pilot, and 8 as null. A standard Wi-Fi symbol is 4us, composed of 3.2us IFFT (useful symbol duration) and 0.8us long guard interval. If using a short guard interval of 0.4us then the total symbol time is 3.6us. Since subcarrier spacing is equal to the reciprocal of symbol time, then: Subcarrier spacing = 312.5 KHz Useful symbol duration = 3.2us IFFT Reciprocal = 1 cycle / 0.0000032 sec = 312,500 cycles/sec = 312.5 KHz

Since IFFT is used for modulation the spacing of the sub-carriers is such that at the frequency where the received signal is evaluated (the centre frequency of each sub-carrier) all other signals are zero. And this in turn drives the duration of the useful symbol time and is the reason why 3.2us IFFT is used.

Another advantage of OFDM is that by using a reduced symbol rate of 250,000 symbols per second the negative effects of multipath distortion are reduced.
Since each symbol occupies more time, there is more resilience to delay spread that is caused by multipath when signal reflections cause multiple copies of the same transmitted symbol to arrive at the receiver at slightly different times.