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A group of researchers at the Georgia Institute of Technology in Atlanta developed a gesture input wristwatch. The Gesture watch recognizes hand gestures and uses them for touch-free control of MP3 players, mobile phones, or home appliances.

The Gesture Watch has five infrared sensors, four of which sense any hand motion that occurs above the watch.
For example, sweeping the right hand once over the watch may mean power on and a clockwise circular motion may mean shuffle and pausing the hand over the watch may mean, power down.
The commands are sent via Bluetooth to the controlled devices.
The Gesture watch is still just a prototype.
More details on the Discovery Channel site.
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