The lunar surface is characterized by a collisionally evolved regolith resulting from meteoroid bombardment. This lunar soil consists of highly angular particles in a broad, approximately power law size distribution, with impact-generated glasses. The regolith becomes densified and difficult to excavate when subjected to lunar quakes or, eventually, manned and unmanned activity on the surface. Solar radiation and the solar wind produce a plasma sheath near the lunar surface. Lunar grains acquire charge in this environment and can exhibit unusual behavior, including levitation and transport across the surface because of electric fields in the plasma sheath. The fine component of the lunar regolith contributes to the operational and health hazards posed to planned lunar expeditions. In this paper we discuss the mechanical response of the regolith to anticipated exploration activities and review the plasma environment near the lunar surface and the observations, models, and dynamics of charged lunar dust.