How crits work, according to PGI (authoritative.)

I can't help but notice that we're still trading folklore and hearsay about how crits currently function in game. So that nobody has to guess anymore, here is the detailed explanation, linked from another thread on here a few days ago, via the forums straight from David and Bryan:

Each time the internal structure of a Mech takes damage, there is a chance that the hit will cause at least 1 critical hit. There is a 25% chance of causing 1 critical hit, a 14% chance of causing 2 critical hits, and a 3% chance of causing 3 critical hits (for a total of a 42% chance of any sort of critical hit). Each critical hit will randomly hit a weapon or piece of equipment in that location; the chance of a particular piece of equipment being hit is proportional to how many critical slots it occupies. Each critical hit damages the weapon/equipment an amount equal to the damage that caused the critical hit.

For example, an Atlas AS7-D is hit with an AC/5, for 5 damage to its left torso’s internal structure. The attacker gets lucky and this results in 3 critical hits. Two of the crits hit the LRM 20 and 1 hits the heat sink. The heat sink will take 5 damage and the LRM 20 will take 10 (5 x 2 = 10).

Currently, all engines have 15 points of health while all other items have 10. One of the changes going through QA right now, and that will be applied to an upcoming patch, is lowering the health of the Gauss rifle to 3 points. And, sometime soon, we plan on doing a full pass on the health of all the items.

Critical damage to the side torso hit boxes of XL engines deals damage to the engine as a whole. However, it should be noted that, currently, critical damage to your engine will not disable it, but simply add to your repair bill. This is likely to change when we do the pass on the health values.

Source: Bryan Ekman & David Bradley:

http://mwomercs.com/forums/topic/76329-transparency-of-rules-bryan-you-did-promise-you-would-get-back-to-us/page__p__1474814#entry1474814

Let us pin this to the sidebar for future generations to admire.