Active dry yeast (ADY) is a finely-divided, dehydrated form of compressed yeast. The conventional method of using this form of dry yeast is to rehydrate it in warm water, at around 105-115 degrees F, for about 5-15 minutes, before combining with other dough ingredients.
By contrast, instant dry yeast (IDY) (sometimes called “bread machine yeast”) does not require proofing in water or any other liquid. These yeasts have more active cells than ADY and are made up of finer yeast particles. They are also of a different strain than ADY and, when combined with flour and other dry ingredients, can also tolerate higher rehydration temperatures than ADY (120-130 degrees F), which promotes faster rising. To further speed up the action of IDY, and to strengthen the dough (by preventing the gluten bonds from breaking down), a small amount of ascorbic acid, or Vitamin C, is usually combined with the yeast to stimulate the yeast.
While some professional and home bakers makers choose to proof IDY, usually in water, it is not really necessary. It can simply be mixed in with the dry ingredients (flour, etc.). Alternatively, IDY can be added to a dough mixture shortly after the beginning of the mixing process. It is also not necessary to defrost IDY if it has been frozen. By the time you are ready to use it in a recipe, the yeast should be ready.
Unlike fresh yeast, which is highly perishable and has a very short shelf life, measured in days, both ADY and IDY have long shelf lives. ADY has a shelf life of about 1 year if the package is unopened (and not refrigerated), and 6 months if tightly resealed and refrigerated after opening and, for added protection, stored in an airtight container. If frozen (also in an airtight container) ADY will last almost indefinitely (although yeast producers usually recommend a much shorter time period—about a year). IDY also has a good shelf life, about 2 years if the package is unopened (and not refrigerated), and 6 months if tightly resealed and refrigerated after opening and, for added protection, stored in an airtight container. If frozen (also in an airtight container) the instant dry yeast will last almost indefinitely (although yeast producers usually recommend a much shorter time period—about a year).
Another difference between IDY and ADY is that you don't need as much IDY to produce the same leavening effects as ADY. If you look at the label on your yeast bottle or package, you should see the equivalencies. It should read something like this:
One packet of active dry yeast = 1/4 oz. = 2 1/4 t. = 1 (0.6-oz.) fresh compressed yeast cake = 1 1/2 t. instant dry yeast.