Matcha is a finely milled green tea powder traditionally used in Japanese tea ceremony. Matcha is made from shade-grown tea leaves called tencha 甜茶. Preventing direct sunlight from hitting the tea leaves allows amino acids, particularly L-theanine, to remain in the leaf in high levels as well as slowing growth, forcing the leaf to produce more chlorophyll. As a result, the tea leaves themselves have a very low level of astringency in respect to sweetness (astringency is caused by the anti-oxidant catechin and while relatively low, is often higher than most green teas).
After the leaves are harvested, they are steamed to prevent them from being oxidized which helps retain their original color, fragrance, and natural components. Unlike gyokuro and sencha, the leaves are not twisted nor rolled. They are then gently tumble dried with cool air, spread out over a flat surface and left to dry further. The veins and stems are separated from the main part of the leaf at the end of the drying process, and after conducting this finishing of the tea leaf, it is called tencha. This tencha is then ground into a fine powder on a stone mill to make matcha.
Often you will find fairly reasonably priced matcha on the market (under $20 / 50 grams). Manufacturers are able to produce more cheaply and with greater volume using several methods. They may use summer or autumn harvested leaves. They may use leaves produced on fields generally used for sencha. They may also use a ball mill instead of a traditional stone mill which results in the generation of heat as the leaves are pulverized. This tends to degrade the aroma and flavor.