A common misconception is that thatch is just grass cuttingss that have not decomposed. Grass cuttings can certainly add fuel to a thatch problem once it exists, but in some circumstances (where "Mulch Mowers" are involved) the cuttings can be very beneficial to the lawn and the soil. When grass cuttings decompose or "recycle" within 1 - 2 weeks they provide valuable nutrients back to the land.
Realisticly, Thatch is a matted layer of roots, stems, blades, runners (and grass cuttings!) that builds up on top of the soil like a blanket. If your lawn is very spongy to walk on and if you part the blades of grass on your lawn to find that there is a matted, vegetative blacket about 1/2 inch+ thick, then you have a thatch problem.
Thatch is undesirable for a lot of reasons but mostly because the grass roots of your lawn are literaly up in the thatch, and only barely in the soil due to the blanket of thatch which holds on to any moisture like a sponge, keeping it away from the soil. The soil will eventually dry out and the grass roots will be forced to grow in the moisture enriched thatch rather than the dry soil. This causes even more thatch! This is not a healthy state for any lawn to be in and makes the grass highly susceptible to insects, drought, and winter-kill. If the grass roots are not anchored into the soil correctly you have a weakend lawn and it is only a matter of time before something kills it off.
Having a thatch problem is a sign that there is something wrong with your soil. It could be preventing the grass from rooting due to "compaction" (or clay) or it is not healthy enough to decompose the dead organic matterial which thatch is built up of. Soil should be abundant with microlife in order to be healthy othwise it will become dead, sterile and baron. If you have used lots of conventional lawn fertilizers that are high in chlorides or salts, you may have killed a lot of beneficial microlife yourself!
"A lack of earthworms is an indicator of a bad soil. In fact, you'll rarely see thatch where earthworms are abundant because along with being great soil aerators, they are one of nature's best thatch digesters."
You can not rectify a heavy thatch problem by using a Scarifying / Dethatching Machine alone. A Scarifier will only tackle the surface problem by removing dead or matted grass, cuttings and debris. The real solution to removing thatch completely is to Aerate your soil so it becomes bioactive and healthly enough to make the thatch to decompose itself. When you do this, the thatch will gradually break down and turn into a rich, natural compost. This process may take several years to fully decompose depending on the severity of the problem, but once the soil is aerated and has a healthy balance of nutrients, it will decompose.
Improve soil aeration. Thatch-decomposing microbes require air to survive, as does your lawn in general. Improving the aeration of your lawn is vital if you want to remove thatch problems and increase your soil's microlife. Using an Aerator rather than a Scarifier or better still, in conjunction with a scarifier, will produce far better reults. In some cases it may be beneficial to take a core sample to see what sort of soil compaction you are dealing with.
Increase the Microlife. Soak some compost in a bucket of water for a day or so and spray the liquid over the lawn. You could also try treating the thatch with a Biological Dethatcher that contains specific microbes and enzymes designed to accelerate thatch decomposition.
Keeping your soil moist - not your thatch. When the soil dries up, decomposition ceases. Less frequent, heavy waterings work best. If you water regularly and lightly you keep the thatch layer itself moist rather than drenching water through to the soil. Fungus may become a problem with frequent watering. Remember - you want to encourage the grass roots to go down into the soil for water and not grow in a wet layer of thatch.
Test the pH Levels of your soil and add Lime as required. Acidic soil can dramatically slow down or even prevent thatch decomposition. To much lime can cause the same problem so this needs to be managed correctly. How to Test / Adjust Your Soils pH Level for Grass Growth
Collect your grass cuttings. They will only add to the thatch problem until it is resolved so stay away from Mulch Mowers if you currently have a problem.
You will need to fertilize on a regular basis because soil micro-organisms need Nitrogen to decompose thatch. You should also try to avoid fertilizers that contain Muriate Of Potash (Potassium Chloride) as chlorides can be hazardous to soil's microlife. Granular fertilizers should also be kept away from, because unless they are water soluble, they will sit on top of the thatch layer and will be very slow to break down and release their nutrients. Liquid fertilizers are normally the best when thatch is present as they will go right through to the soil when watered in, and won't get stuck on/in the thatch. Monthly applications of a liquid fertilizer (that is free from Salt or Chloride) will provide more Nitrogen and will therefore promote faster thatch decomposition.