When you select Auto-seed, you'll be asked to choose from several options.

By Registration Order

Seeding by Registration Order will seed all teams / players in the order that they joined your tournament.  This is normally used when you have set a cap on the number of players that will be allowed to play and you need to ensure that the first set of players to join get priority over those players who joined in the wait list.  Combining this with Tournament Check-in allows you to only seed the first set of players that have actually checked-in and will take additional checked-in teams / players from the wait list in order of registration.  If you also want to randomize this seeding then after Auto-seeding press the Shuffle Seeds button to change the seed numbers without affecting which players are actually seeded.

Seeding Randomly will shuffle the teams / players that entered your tournament and seeds will be randomized.  If you have set a tournament registration cap, seeding Randomly will ignore who registered first.  It is suggested to only use this if you are seeding All players or All Checked-in players.  This is the option most organizers use when the tournament does not have a registration cap or the cap has not been exceeded.

Seeding by bracket standings is only shown when you have multiple brackets.  This is extremely useful in running a tournament where you want to take the top players from a Swiss Bracket and seed them into an Elimination Bracket.  When using this feature, you will be prompted with the previous bracket you would like to use to seed into the current bracket.  After selecting the previous bracket, you can then select the number of teams / players you want to seed.  For example: if you select 8 then the teams / players that are ranked 1st through 8th will be seeded into the current bracket with seed numbers 1 through 8.