The bug tracker is for me the most important tool in a Test Project. When I start a new project the first thing I put in place is the bug/issued/defect tracker. The issue tracker is the central place of a project. When you start to reviewing the project and you have doubts or issues. Raise a issue in the bug tracker. When you make the plan raise an issue.
In that way you easily log everything and reduce emails (you loose), numurous meetings without meeting minutes etc.
In my opinion the best tool is a web based tool that can be configured easily and is user friendly. I have used excel, Access, Traq, Jira, Bugzilla, Mantis and HQ Quality Center. But for me the number 1 is Mantis. It is so easy to use and to configure, has a nice user interface and has good reports. It is also a tool that can be implemented very easy.
I recommend to use as much as possible the standard configuration of the tool. It easy to add additional fields, but before doing that evaluate if those additional fields really add any value. Keep it simple.
When reporting try to make write clear summaries. Both for project related issues and for bugs/defects.
For example (bug summary): When logging in with an incorrect user name the error message is unclear.
Or for an (project) issue: The funtional documentation is not delivered on the agreed date.
It is important to set some clear rules, a defect/issue process, that need to be followed by the whole team. The main rule for me: Reporter of issues is responsible for closing the issue. When I say responsible it does not mean he has to close it him/herself, but at least be aware of who is closing the defect.
For more info on my favourite open-source defect tracker: http://www.mantisbt.org/
SimplyTesting 