Available in many new cars, this technology helps drivers maintain control of their vehicle during extreme steering maneuvers by keeping the vehicle headed in the driver's intended direction, even when the vehicle nears or exceeds the limits of road traction.
When drivers attempt an extreme maneuver (for example, to avoid a crash or because a curve's severity has been misjudged), they may experience unfamiliar vehicle handling characteristics as the vehicle nears the limits of road traction. The result is a loss of control. This loss usually results in either the rear of the vehicle "spinning out," or the front of the vehicle "plowing out."
A professional driver, with sufficient road traction, could maintain control in an extreme maneuver by using various techniques, such as countersteering (momentarily turning away from the intended direction). It would be unlikely, however, for an average driver to properly apply countersteering techniques in a panic situation to regain vehicle control.
How ESC Works
Electronic Stability Control (ESC) uses automatic braking of individual wheels to prevent the heading from changing too quickly (spinning out) or not quickly enough (plowing out). ESC cannot increase the available traction, but maximizes the possibility of keeping the vehicle under control and on the road during extreme maneuvers by using the driver's natural reaction of steering in the intended direction.
ESC happens so quickly that drivers do not perceive the need for steering corrections. If drivers do brake because the curve is more or less sharp than anticipated, the system is still capable of generating uneven braking if necessary to correct the heading.
ESC systems exist under many trade names, including Vehicle Stability Control (VSC), Electronic Stability Program (ESP), and Vehicle Stability Enhancement (VSE).
Excerpted from http://www.safercar.gov/portal/site/safercar/menuitem.13dd5c887c7e1358fefe0a2f35a67789/?vgnextoid=de58e66aeee35110VgnVCM1000002fd17898RCRD