Smart bullet is a term that has been used to describe several theoretical and prototype bullet

Bullet

A bullet is a projectile propelled by a firearm, sling, or air gun. Bullets do not normally contain explosives, but damage the intended target by impact and penetration...

s. The "smart" part comes from the bullet doing something other than simply following its given trajectory, e.g. turning, speeding up, slowing down, sending data, etc.

Changing trajectory

One kind of smart bullet is a projectile that is capable of changing its course during flight. One use of this would be to enable soldiers to stay behind protective cover and shoot around corners. One implementation uses a muscle wire inside the bullet. The wire shortens or lengthens, causing the bullet to bend. Another implementation uses a spoiler and micro gyro to control the bullet.

Navigating

Honeywell Aerospace has produced inertial measurement unit

Inertial measurement unit

An inertial measurement unit, or IMU, is an electronic device that measures and reports on a craft's velocity, orientation, and gravitational forces, using a combination of accelerometers and gyroscopes. IMUs are typically used to maneuver aircraft, including UAVs, among many others, and...

s based on MEMS

Microelectromechanical systems

Microelectromechanical systems is the technology of very small mechanical devices driven by electricity; it merges at the nano-scale into nanoelectromechanical systems and nanotechnology...

 and microelectronics technologies that it claims can survive the shock of being fired out of a gun.

Transmitting data

Another smart bullet is one that can transmit data about the location into which it has been fired. A prototype has been created by researchers at the University of Florida

University of Florida

The University of Florida is an American public land-grant, sea-grant, and space-grant research university located on a campus in Gainesville, Florida. The university traces its historical origins to 1853, and has operated continuously on its present Gainesville campus since September 1906...

 in Gainesville, Florida

Gainesville, Florida

Gainesville is the largest city in, and the county seat of, Alachua County, Florida, United States as well as the principal city of the Gainesville, Florida Metropolitan Statistical Area . The preliminary 2010 Census population count for Gainesville is 124,354. Gainesville is home to the sixth...

, USA

United States

The United States of America is a federal constitutional republic comprising fifty states and a federal district...

 with funding from Lockheed Martin

Lockheed Martin

Lockheed Martin is an American global aerospace, defense, security, and advanced technology company with worldwide interests. It was formed by the merger of Lockheed Corporation with Martin Marietta in March 1995. It is headquartered in Bethesda, Maryland, in the Washington Metropolitan Area....

. The bullet (projectile) has a sensor inside of it that can send wireless data up to 70 meters.

Limiting range

Another smart bullet is one that self-destructs within a limited range. This would be used to minimize collateral damage of a bullet in case of a miss. For example, hunting near a populated area. This would involve either change in course into the ground, or near vaporization.