Interlinking is a good optimization technique

How and why is it good?

People are naturally going to link to inner pages ... individual articles, blogs, stories, etc. on your site. If you're going to buy links for the sake of them appearing natural, you would buy links to inner pages. However, this is a rather black hat strategy.

I would focus most of your links towards the page you want people to visit (i.e. homepage). Then do the rest on your inner pages, just to make it look natural.

Do you have to have links to the inner pages to get Page rank.. My main category pages were Page rank 3 , however now they are 0. Is this because I didn't build links to them or I didn't update them enough?

PR depends on the link structure of your site. If there are external links leading to your inner page, and that page has outgoing links to other sites -- the PR that you received is passed on to the site you are linking to. Normally, you should have external links to only your Home page which in turn should be linked to other pages in your site and vice-versa. The Home page distributes the PR to the linked pages and in turn receives its share of PR from the site pages. This keeps most of the PR within the site pages. Search Engines rank individual pages--not sites. So if your inner pages have turned up with a PR0-it means your site is leaking PR. You should only have external links pointing to your inner pages if they are more than 5 levels in depth--from the Home Page--because spiders do not index pages that are more than 5 levels deep--but they will follow links from other sites.

Regards
Sunil
http://www.seo-sem-professionals.com

That is some great information. I have done a lot of deep linking on my site, and when I first started doing it, I went from PR3 to PR 1 in about 3 days. It was horrible, but now, I am PR3 again, so I'm not sure what happened.

Maybe when you first started Deep linking, you did not add links back to the Home Page and other Pages. A Deep Page linking back to the other pages in the site receives and distributes PR evenly throughout the site. Whe your sites Link structure was set right- the PR returned to normal.

Link only pages that have most important keywords in your industry. Use descriptive link text when you link to your inner pages. Also link to your homepage from any subpage of your site.