Nanotechnology is any technology that works on the scale between atoms and bacteria, typically measured in nanometers (there are 1,000,000 nanometers in a millimeter). The idea was first proposed by the physicist Richard Feynman in a lecture entitled "Plenty of Room at the Bottom"..
Examples of Nanotechnolgy
Solid State Physics
In Solid-State Physics, nanotechnology is being used to engineer the next generation of computer components, which will exploit quantum mechanics in order to perform certain operations much faster than current technology. This idea was again first proposed by Richard Feynman, in a conference keynote speech, later printed as an article in the International Journal of Theoretical Physics.
In medicine, nanotechnology is being used to develop new and more sophisticated methods of drug delivery. Nano-scale devices are also being developed to test patients for toxins and diseases on-site, so as to avoid the long, costly process of sending medical samples to labs. 
Construction and Engineering
Carbon nanotubes are a strong, light material that will be useful in engineering and constructing. Nano-particles are currently in use at St. Pancras Station London as part of the station's self-cleaning roof.
A common use of nanotechnology in the context of MEMS is found in digital light projectors, or DLP devices, which use a microscopic array of mirrors to represent the pixels of a digital image. By rapidly switching these mirrors off and on in conjunction with an intense light source, high-quality still and moving images can be projected with little loss of color saturation or sharpness.
Micrometer - One millionth of a meter.
Angstrom - One tenth of a nanometer (this isn't an SI unit)
MEMS - Micro-Electro-Mechanical Systems, or MEMS, are nano-scale items that combine both electronic (integrated circuits) and mechanical (pumps, mirrors, servos) components to create machines which function on a microscopic scale. 
Self-assembly - Reversible processes in which pre-existing parts or disordered components of a preexisting system form structures of patterns. Use of self-assembly techniques allows for bottom-up construction of components, and is used in applications where top-down methods like lithography are impractical.
There are ways of creating a piece of nanotechnology. The 'Top Down' method involves taking a larger object and removing parts to create a smaller structure similar to creating a statue from a block of stone. An example of a top down method is 'Electron Beam Lithography'. 'Bottom Up' nano technology means assembling a object from smaller parts, similar to building a statue out of LEGO bricks. An example of a bottom up method is 'Molecular Self Assembly' .
"Grey Goo" Scenario Concerns
The "Grey Goo" scenario refers to a worst-case prediction of self-assembling nanotechnology run amok. The premise starts with the assumption that nano-scale machines could be built with the ability to break down substances and reconstruct the pieces into other structures, including copies of the nanomachine itself. In an ideal situation you could place one in a garbage dump and program it to replicate itself as needed, break down and reassemble the matter in the landfill into something useful like bricks, and then deconstruct themselves when done. In the "Grey Goo" scenario something goes wrong with the programming, and like cancer, all the machines do is break down objects to create more replicas, each with the same errant program. Based on exponential replication, the entire planet could be broken down into a "Grey Goo" by self-replicating nanobots in a matter of weeks or even days. This scenario first reached prominence in a New York Times Magazine article by Lawrence Osborne titled "The Grey Goo Problem".
This scenario is highly improbable since it requires a level of technology decades more advanced than at present, and the assumption that such advanced technology would not incorporate comparably-advanced safeguards.
Recently, there have been issues raised about the effect nano particles can have on the human body, particularly concerning their use in cosmetic products. Companies such as L'Oreal and Unilever use nano particles as UV blockers in their sun creams. Consumer organisation 'Which' have question the amount of research carried out into the long term health affects of these particles and this has led to increased interest in government regulation of nano materials.
A concern for people working in nanotechnology-related industries is over the potential health impact of being exposed to these particles over time, particularly if they are inhaled. This concern is based on the effect of inhaling other fine-particle forms of pollution. For example, the most minute bits of soot in diesel exhaust, known as ultrafines, measure on the nanoscale. When inhaled, they journey into the smallest air passages in the lungs, which are off-limits to larger particles. There they cause respiratory problems and, more surprisingly, heart disease, according to University of Rochester research.
Chemically, nanoparticles tend to be more reactive than larger amounts of the same substance, because they have more surface area and therefore more opportunity to interact with other substances. That means a chemical that's normally harmless might be toxic in minuscule doses. Animal studies show that inhaled nanoparticles can cause pulmonary inflammation, move from the lungs to other organs, and interfere with cell signaling.
The risks of this type of particle inhalation are not likely to affect users of nanotechnology-based items, but are a potential risk to those involved in their manufacture. In response, the National Institute for Occupational Safety and Health (NIOSH) is advocating the establishment of registries for businesses that make nanoparticles, and for individuals who work in the industry, as a first step in collecting data that would, over time, help identify patterns requiring specific investigation and analysis.
Nanotechnology in Fiction
Nanotechnolgy has been the basis for many works of science fiction, such as Michael Crichton's Prey and Greg Bear's Slant.
- ↑ There's Plenty of Room at the Bottom, An Invitation to Enter a New Field of Physics, by Richard P. Feynman, transcript of a talk given by Richard Feynman on December 29th 1959 at the annual meeting of the American Physical Society at the California Institute of Technology, first published in the February 1960 issue of Caltech's Engineering and Science 
- ↑ Simulating physics with computers, R Feynman, International Journal of Physics, 21, 467. http://www.springerlink.com/content/t2x8115127841630/?p=4c2181eb362349dcbae9f86495d82f03&pi=1
- ↑ http://www.sciam.com/article.cfm?id=size-shape-matter-nanotech-drug
- ↑ http://www.azom.com/news.asp?newsID=14569
- ↑ http://www.skynews.com.au/health/article.aspx?id=278102
- ↑ http://www.dlp.com/tech/what.aspx
- ↑ http://www.nano.gov/html/facts/faqs.html
- ↑ http://www.mems-exchange.org/MEMS/what-is.html
- ↑ http://www.edinformatics.com/nanotechnology/self_assembly.htm
- ↑ http://it.toolbox.com/wiki/index.php/Top-down_Approach_to_Nanotechnology
- ↑ Fundamentals of Microfabrication: The Science of Miniturization,Marc J. Madou ,ISBN 0849308267
- ↑ http://query.nytimes.com/gst/fullpage.html?res=9C06E4DF163CF937A25751C1A9659C8B63
- ↑ http://www.crnano.org/BD-Goo.htm
- ↑ http://news.bbc.co.uk/1/hi/health/7706818.stm
- ↑ http://www.sciam.com/article.cfm?id=will-nano-particles-present-big-health-problems
- ↑ http://www.sciam.com/article.cfm?id=will-nano-particles-present-big-health-problems&page=2