In conventional wireless communications, a single antenna is used at the source, and another single antenna is...
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used at the destination. In some cases, this gives rise to problems with multipath effects. When an electromagnetic field (EM field) is met with obstructions such as hills, canyons, buildings, and utility wires, the wavefronts are scattered, and thus they take many paths to reach the destination. The late arrival of scattered portions of the signal causes problems such as fading, cut-out (cliff effect), and intermittent reception (picket fencing). In digital communications systems such as wireless Internet, it can cause a reduction in data speed and an increase in the number of errors. The use of two or more antennas, along with the transmission of multiple signals (one for each antenna) at the source and the destination, eliminates the trouble caused by multipath wave propagation, and can even take advantage of this effect.
MIMO technology has aroused interest because of its possible applications in digital television (DTV), wireless local area networks (WLANs), metropolitan area networks (MANs), and mobile communications.
(This information courtesy of Whatis.com.)