From a question on ReEdit/LOTRO
Same question for "tactical mitigation". And are both good for all classes ? Does my Hunter need both ?
Tactical and Physical are damage types (Look at your skill tooltips, they'll say one or the other). Mitigation reduces the damage you take from that type.
It reduces incoming damage (physical from common/physical attacks, like arrows and melee; tactical being from other sources, like poison, fire, fear, etc.). A hunter would only like it to reduce incoming damage while leveling. It is not something to strive for while leveling. At high levels (at and very near max), you want to get to what is called the mitigation cap for both of those (that is 50% on all "sources").
To expand on this a bit, it's not a useless stat while levelling, reduced incoming damage is obviously helpful, and it's not something to avoid if you get easy access to it. The point is that if you're taking too much sustained damage it's usually easier to focus on killing things faster and using Crowd Control more effectively. At the level cap mitigations get more important because burst damage becomes a larger issue, especially in raids and fellowship instances you run a real risk of getting one-shot, a single attack that deals more than your full morale. That's when mitigations help a lot: a healer can probably help you out if a single smash gets you to a quarter of your morale, that's what they're for, but in-combat revives are rare and cost a lot of time to cast. You really want to be in a spot where a single attack won't kill you when you get serious about high level instances,