A Near-Term Application of 'Nanotechnology': Nanofluids
Often when we see the term nanotechnology, we think of utopian visions of submicroscopic robots, cleaning out our cells and bringing a new age of immortality and prosperity (or, an unending dark age of repression and torment, if you're being pessimistic.)
Much of the work that's being done under the rubric of nanotech is much more mundane, and might even be applied in the near term. I've just come across one of the more exciting possibilities, one that is attracting a lot of research effort. It's been discovered that suspensions of nanoparticles (of size less than 100 nm) can dramatically alter the thermal properties of liquids.
It's been found that adding 0.3% copper nanoparticles to liquids can increase the thermal conductivity by 40%. Higher thermal conductivity increases the efficiency of heat transfer in heat exchangers. This is attracting the attention of companies such as Valvoline (nanotech radiator fluid, nanotech engine oil), as well as nuclear engineers, who envision retrofitting existing PWRs with a nanofluid as the primary coolant in order to increase the thermal capacity of the reactors (new nuclear fuels with enhanced internal thermal conductivity would also help here.)
Another interesting application would be in rocket fuel. Suspend a small quantity of nanometer carbon (diamond would be particularly good, or possibly short carbon nanotubes) in RP-1 and the fuel would become a better coolant in rocket thrust chambers. This would enable the engine to operate at higher chamber pressure without excessive wall heating. If the nanoparticles were aluminum, the specific impulse of the engine would increase even without a change in the chamber pressure or geometry.
As far as I can tell they don't yet have a good understanding of why nanoparticles have this effect. It'll be interesting to see what's going on here.