Augments are items you can loot or purchase through the Lost Dungeons of Norrath expansion. They can add stats, procs, effects, etc to items. When you get an augment, you have to choose which item you wish to put it on (and which can hold it; not all augments fit into all items) and combine them in a container located at each camp. Once combined, the item reads as "augmented" and shows the new stats, plus you can click on the augment item itself and see what it does.
Wow. Regular ol' Joph fan club in here.