Essentially, a blood pressure
monitor cuffed on to the penis to measure minute changes in the engorge
ment of the penis, ostensibly to detect arousal
levels when exposed to various stimuli.
The machine was invented in Czechoslovakia as a means of determining who was only claiming to be gay to dodge the draft and who was a genuine homosexual. The device is now used in several countries across the world (the USA, China, Britain, Norway, Brazil and Spain), primarily in sex-offender treatment situations, many of which combine its use with aversion therapy - shocking the offender when he registers arousal to an "inappropriate" stimulus.
Though there are many proposed applications for this technology, it is important to remember both that the device measures engorgement (where the blood is or is not) rather than arousal-desire (a distinction anyone who's ever woke up with morning wood will be quick to agree with) and that interest in a particular subject matter does not necessarily equate to a likelihood that the person tested would engage in such activities as those which interest them (the canonical examples being men who enjoy watching lesbians pleasuring themselves or people lasciviously eating a banana without having sex with lesbians or rogering fruit-bowls as a part of their lifestyle) - what is often forgotten is that "from a scientific, moral and legal point of view, what should matter is whether a person gives in to perverse desires and commits sex crimes. It is neither immoral nor a crime to get aroused."
Recent inappropriate uses of the penile plethysmograph include its use in court as a sort of sexual-interest lie detector (despite experts' ranging opinions that it is anywhere from only two-thirds to 95% effective and despite expert testimony by Dr. Michael Tyson, a clinical and forensic psychologist specializing in the field of sexual criminal behavior (as opposed to boxer Mike Tyson, the other specialist in the field of sexual criminal behavior), that "the vast majority of individuals who commit sexual offenses against children are not sexually aroused by stimulus material involving children") and its use as a screen for potential offenders as a condition for employment, for enlistment in the military, for granting custody for children and for granting parole leave... and why wouldn't you allow yourself to be subjected to the test unless you had something to hide?
Pretty much the only undisputed practical use for this technology thus far is to determine between psychological and physiological impotence - when attached to a subject who then goes to sleep it measures arousal levels during REM sleep, where increases in penile circumference are expected and, if found, confirm the psychological nature of the problem.
I'm sure you'll be hearing more about this controversial machine in the future, but remember that you heard it here first!