Visit the Blacksmith to engrave gear with new properties. New properties will become available as you level up and complete the required challenges. The gear you’ll get will have default engravings already but almost all of them will have a free slot where you can add another engraving of your choice.
High rarity equipment will have multiple engravings by default. You can replace these manually-applied engravings as you want, though you’ll have to spend the same amount of Materials and gold. You can even engrave gear that's above your level even though you can't wear them yet.
Engravings requires a fixed amount of Materials and gold. Each engraving has 5 tiers which will allow you to get more boosts and bonuses for a particular engraving by meeting the requirements again to level it up. For example, +2% Hunter Damage becomes first available after reaching LV2. For its next tier, you need to reach LV12. You can check all available engravings from the Engraving List in the Inventory Menu and view the challenges and level requirements to unlock/improve them.