AWD stands for All-Wheel Drive. This mechanical system engages all four wheels of the vehicle at the same time without driver intervention, giving the driver better control of the vehicle.
AWD and 4WD, or Four-Wheel Drive, both engage all four wheels at the same time. 4WD is driver selected as opposed to the automatic nature of AWD.
AWD has the advantages of having twice the grip of the manual selection needed with 4WD and engaging on its own in unforeseen conditions. Conditions where AWD is advantageous include slippery or icy roads when more traction is needed or when a fraction of a second makes a difference in being able to safely navigate the vehicle.