Target tracking is a ship and guns statistic that helps negate accuracy penalties from your ship's movement and the relative movement of the target.
From Taelorn on the forums:
Target Tracking - This is a stat that appears on guns and on ships. Target tracking helps negate the penalties suffered by movement, but it can never provide a bonus to accuracy. Each point of target tracking equates to 1% accuracy unless your tracking is higher than the cumulative penalties.
To fully understand the effect target tracking gives, it is necessary to understand the penalties it nullifies.
Your Ship's Movement PenaltyEdit
When your ship is moving, it accrues an accuracy penalty to its weapons. For each 1 knot of speed, all ship weapons suffer -2% to their accuracy.
Target's Relative MotionEdit
When a target you're firing at is moving in a different direction than your ship, it becomes harder to hit the more it's moving compared to your current heading. For every degree/second of separation, there is a -6% modifier to accuracy.
In other words, a ship that's sailing alongside (parallel to) you at the same speed is much easier to hit than a ship passing your broadside at full speed in the opposite direction.
Target Tracking NegationEdit
The target tracking statistic will negate as much of these two penalties as possible (but never provide a bonus).
So if you have a ship with a Target Tracking of 24, you could be going as fast as 12 knots and suffer no penalty. (Assuming your target is moving the exact same direction and speed, 12 knots = -24% accuracy, which is offset by 24 Target Tracking). Or if you're stationary, and a ship you're firing at is moving (relative to you) 4 degrees per second, you would still incur no accuracy penalty with a target tracking of 24. (Relative target movement of 4 degrees per second = -24% accuracy, which is offset by 24 Target Tracking.)
Target Tracking will never provide a bonus to your accuracy aside from negating these two penalties. So if you're in a ship that's not moving and your target is not moving, your target tracking statistic is not helping in any way.