About blended objects
You
can blend objects to create and distribute shapes evenly between
two objects. You can also blend between two open paths to create
a smooth transition between objects, or you can combine blends of
colors and objects to create color transitions in the shape of a
particular object.
Note: Blending
objects is not the same as applying blending modes or transparency to
objects. For information on blending modes and transparency, see
About blending modes.
Once you create
a blend, the blended objects are treated as one object. If you move
one of the original objects, or edit the original object’s anchor
points, the blend changes accordingly. In addition, the new objects
blended between the original objects don’t have their own anchor
points. You can expand the blend in order to divide the blend into
distinct objects.

Example of using a blend to distribute shapes evenly between
two objects

Example of using a blend to distribute color smoothly between
two objects
The following
rules apply to blended objects and their associated colors:
You
cannot blend between mesh objects.
If you
blend between one object painted with a process color and another object
painted with a spot color, the blended shapes are painted with a blended
process color. If you blend between two different spot colors, process colors
are used to paint the intermediate steps. If, however, you blend between
tints of the same spot color, the steps are all painted with percentages
of the spot color.
If you
blend between two patterned objects, the blended steps will only
use the fill of the object on the topmost layer.
If
you blend between objects that have blending modes specified with
the Transparency panel, the blended steps will only use the blending
mode of the top object.
If you
blend between objects with multiple appearance attributes (effects,
fills, or strokes), Illustrator attempts to blend the options.
If you
blend between two instances of the same symbol, blended steps will
be instances of that symbol. If, however, you blend between two
instances of different symbols, the blended steps will not be symbol
instances.
By default,
blends are created as knockout transparency groups, so that if any of
the steps consist of overlapping transparent objects, these objects
will not show through each other. You can change this setting by
selecting the blend and deselecting Knockout Group in the Transparency
panel.