HTML5 <nav> Element
The <nav> element specifies a section of navigation i.e. a group of navigational links.
In HTML 4 there is no way of distinguishing navigation from other elements in a document, it is placed most often in divs or lists so that styles can be effectively added.
The <nav> element gives you a way of highlighting the main navigation on a site. As the W3C say in the current draft for HTML5:
Not all groups of links on a page need to be in a
<nav>element — the element is primarily intended for sections that consist of major navigation blocks.
Highlighting the main navigation on a site can benefit users of screen readers which can be set up to recognize to <nav> elements instead of having to look through a series
of divs to locate the navigation.
The W3C also state that any links in a page footer should be placed in a <footer> element and not a <nav> element.