A dynamic menu that suggests queries by matching what the user has typed so far with that user's recent search history and/or popular queries among users in general. In some cases (e.g., Apple), autocomplete features search results rather than queries, thereby serving the Best Bets function, and skipping the search results interface altogether.
Serves as a short-cut, helping users to avoid unnecessary typing. Assists with spelling and may suggest related or more specific queries (that begin with or include that word or phrase).
Potentially useful in most contexts (but not always feasible).
Autocomplete (Yahoo Pattern Library)