A hanging indent is when the first line of a paragraph starts at the left margin, but each line after that is indented. It is sometimes referred to as a "hanging paragraph" or "outdent."
Hanging indents are used almost exclusively for bibliographies. They are a visual cue to show the reader where each separate entry begins.
Hanging indents show the reader where a new entry begins, without adding any extra space in between the lines. You can also use a hanging indent when using enlarged, decorative letters in the beginning of a paragraph. This will give the decorative letter the space it needs to be appreciated on its own, without being crowded by the surrounding text.
A regular indent or an outdent is usually 1 em in size. An em is a relative unit of measurement used in typography that is equal to your font size. For example, if you are using Times New Roman font in 12-point size, 1 em would be 12 points. If you are using a font that is very light, a smaller indent may be appropriate. If your font is bold or dark, you should use a larger indent. Use your personal judgment in deciding the size that looks best.
Sometimes writers will try to set a hanging indent by pressing the tab key or space bar at the beginning of each line. You shouldn't use this method, because if you need to make any changes to your text later on, you will need to fix all your indents.
The best way to set a hanging indent is by adjusting the ruler at the top of your word-processing program. Highlight the lines that you need to indent, and slide the bottom part of the ruler to the right.