Auto-Negotiation is a technology that was introduced by National Semiconductor to the IEEE 802.3u 100BASE-T working group in the Spring of 1994 as a result of the need for a mechanism to accommodate multi-speed network devices. It’s a mechanism that takes control of the cable when a connection is established to a network device. Auto-Negotiation detects the various modes that exist in the device on the other end of the wire and advertises it own abilities to automatically configure the highest performance mode of interoperation. As a standard technology, this allows simple, automatic connection of devices that support a variety of modes from a variety of manufacturers. [Source: An Introduction to Auto-Negotiation]
Auto-Negotiation was previously called NWay. The term is often seen written as either Auto-Negotiation or as one word, autonegotiation.