all mass exerts a gravitational force, and the tidal bulges on the Earth exert a gravitational pull on the Moon. Because the Earth rotates faster (once every 24 hours) than the Moon orbits (once every 27.3 days) the bulge tries to "speed up" the Moon, and pull it ahead in its orbit. The Moon is also pulling back on the tidal bulge of the Earth, slowing the Earth's rotation. Tidal friction, caused by the movement of the tidal bulge around the Earth, takes energy out of the Earth and puts it into the Moon's orbit, making the Moon's orbit bigger (but, a bit pardoxically, the Moon actually moves slower!).
The Earth's rotation is slowing down because of this. One hundred years from now, the day will be 2 milliseconds longer than it is now.
http://curious.astro.cornell.edu/question.php?number=124