To create a smooth looking Gradient or Blend in Illustrator look to these steps.
If you are using the Blend Tool and you are getting banding, double-click on the Blend Tool in the Tool Palette. This should bring up a dialog box, make sure the pull-down menu is set to Smooth Color. This should eliminate banding caused by the tool. This will not fix blends you have already created, just those you make after you change the setting.
Illustrator Gradients are mathematical equations that are passed from the EPS or AI file to the printer to re-create the blending of colors that you have asked for. If you are seeing banding in a Gradient, it is a product of your printer not the Illustrator file. There is no setting in Illustrator that will solve this problem.
In older versions of Illustrator (pre-CS versions) the resolution of the document did effect the information in the mathematical equation that was passed to the printer. So making sure you had a high resolution assigned to the document made a difference. With the CS versions, that is not true.
If you have banding in a Gradient and are stuck using that printer you may try re-creating the Gradient in Photoshop, see Photoshop Gradients below.
Limited by your output device
No matter what you do in Illustrator (or Photoshop) to solve a banding problem when you print, you are at the mercy of the output device.
Desktop printers have different settings and abilities when it comes to printing blends. Less expensive printers have fewer steps available and make the banding worse. More expensive printers have more steps available to reproduce color and so banding is less pronounced.
Most Printers (as in commercial printers) RIPs are very high resolution and have even more steps available to them. Color copiers and digital presses typically have the high resolution RIPs attached to them, but not always. So you have to know your output device.
Adding Noise to an Illustrator Gradient or Blend sort of defeats the purpose of doing it in Illustrator. In order for Illustrator to take advantage of Noise it has to rasterize the blend, which turns the blend or gradient into a bitmapped image like you would make in Photoshop. If the size of your document is large (inches) you may end up with a very large (MB) file. If you must do it this way, make sure your Rasterize settings in Illustrator are set to High Resolution (300 dpi). Anything less may not produce good results in print.
Sometimes you can get better results off your printer if you use a Photoshop created Gradient. Printers treat photos differently than mathematical instructions. Either re-create the gradient in Photoshop or rasterize (at 300dpi @ 100% size) your Illustrator gradient in Photoshop, you can add a little noise (not much, a little goes a long way) this helps break-up any banding your printer might produce.
This won’t always solve the problem. Sometimes it is a matter of the colors you are using. Adobe has suggested keeping the difference in color less than 50%. So if you want to create a gradient of PMS 280 go from 100% to 50%, but not 100% to 10%. There are a limited number of steps and the greater the variance in color the more steps are needed to make it look smooth. Keep the variance smaller and the printer can use more of its steps to accomplish the task.