If you are planning to submit your plugin to the WordPress Plugin Directory, you must also include a standard readme.txt file. This is a required file and your plugin won't be accepted to the Plugin Directory without it. The format of this text file is important because it contains necessary information about your plugin that users can open and read, as well as information that displays on your plugin's page within the Plugin Directory. The information in this file includes required and optional elements, as described in Table 6-1.
An example of a properly formatted readme.txt file looks like this (this one contains all the required components):
=== WordPress Twitter Connect === Contributors: LSWilson Tags: twitter, social media Requires at least: 2.7 Tested up to: 3.0 Stable tag: trunk Submits your WordPress blog posts to your Twitter account when you publish. == Description == Use this plugin to automatically submit your blog posts to your Twitter account when you hit the publish button. You can also submit your blog posts to multiple Twitter accounts, specified in the WordPress Twitter Connect options page in your Dashboard. == Installation == Extract the zip file and just drop the contents in the wp-content/plugins/ directory of your WordPress installation and then activate the Plugin from Plugins page.
If you're concerned about whether your plugin's readme.txt file adheres to the expectations of the WordPress Plugin Directory, use the WordPress validator tool (http://wordpress.org/extend/plugins/about/validator) to validate the file. This tool tells you whether your readme.txt file contains all the necessary components and information. If you're still having problems, there is a very handy readme.txt file generator located at http://sudarmuthu.com/wordpress/wp-readme that helps you generate a valid readme.txt file for your plugin by making sure that the basic requirements are met, as described in the previous sections.