While in an inn or a major city (such as Thunder Bluff), your player portrait will begin to glow and your level in your portrait will be replaced with the letters "ZZZ", indicating that you are resting. If you log off here, you will continue to rest while offline. When rested, your XP bar will turn blue, and a notch will appear indicating exactly how rested you are. You will earn double XP from killing monsters while rested until your XP bar fills to the notch. Experience you gain from a quest has no effect on the amount of rest you have left over, and it will not double up if you are rested.