Not to be confused with the similar system of Differential GPS, The Wide Area Augmentation System or WAAS is an enhancement to the global positioning system to improve positional accuracy. It was originally designed for the purpose of landing aircraft.
A WAAS-equipped receiver can pinpoint a postion to within 3 metres for 95% of the time, yet like normal GPS operation does not require any subscription fees. Ironically it has not, at the time of writing, been approved for aviation use, but civilian GPS users can already take advantage of it in the areas where coverage is present.
The system works by having a collection of base stations on the earth at precisely known locations. These stations can find their estimated position according to the GPS system and therefore calculate the error of the system versus their actual location.
The error information is passed to satellites, which then broadcast the error information back down to earth to any interested WAAS receivers.
The WAAS system is far more local than the GPS system, and although it's possible to pick up a WAAS signal from neighbouring countries, the accuracy will suffer. Most of North America is covered and any other country can implement the system for themselves.
The satellites broadcasting the WAAS signal are geostationary, and therefore orbiting around the equator.
Unfortunately, this means that features such as mountains can obscure the equatorial horizon and therefore block the signal. It is highly suitable for use in the air, or on open water, however.
Many new consumer GPS units are being shipped WAAS-ready, so that when the system is implemented in your area, you can take full advantage.