Port forwarding is telling your router to direct traffic on ports X to computer Y.
IP: This is the IP address of the computer you want the traffic to go to, this needs to be set to static otherwise this address will change on you.
External Port: Port the outside client is configured to
Internal Port: Port the software is configured to (is usually the same as External Port unless you deliberately set it differently)
(This is that say you have 4 computers running the same software, you could give each one its own external port to identify each computer, but have the software all set on the local computers to use the same port).
TCP/UDP: TCP uses error checking, UDP does not. If you don't know which one the software uses then use both...