What is PDD-NOS?

I will copy/paste the info from Autism Speaks

PDD-NOS

Diagnostic Overview
Pervasive Developmental Disorder-Not Otherwise Specified (PDD-NOS) is one of the autism spectrum disorders and is used to describe individuals who do not fully meet the criteria for autistic disorder or Asperger syndrome.

PDD-NOS may be thought of as “subthreshold autism," or a diagnosis one can give a person who has “atypical symptomatology.” ²  In other words, when someone has autistic characteristics but some of their symptoms are mild, or they have symptoms in one area (like social deficits), but none in another key area (like restricted, repetitive behaviors), they may be given the PDD-NOS label.

In the DSM-IV Criteria for a Diagnosis of Pervasive Developmental Disorder Not Otherwise Specified, PDD-NOS  is covered in a single paragraph, which mainly asserts what it is not:
"This category should be used when there is severe and pervasive impairment in the development of reciprocal social interaction associated with impairment in either verbal or nonverbal communication skills or with the presence of stereotyped behavior, interests, and activities, but the criteria are not met for a specific Pervasive Developmental Disorder, Schizophrenia, Schizotypal Personality Disorder, or Avoidant Personality Disorder. For example, this category includes “atypical autism” – presentations that do not meet the criteria for Autistic Disorder because of late age at onset, atypical symptomatology, or subthreshold symptomatology, or all of these." ¹

American Psychiatric Association. (2000). Diagnostic and statistical manual of mental disorders (4th ed., rev.). Washington DC: Author. (Pg. 84) 

When might a person receiv a diagnosis of PDD-NOS?
That will vary, of course, but in one study, researchers found that those with PDD-NOS could be placed in one of three very different subgroups: ⁴

• A high-functioning group (24%) who resembled people with Asperger syndrome but had transient language delay or mild cognitive impairment (such that they could not receive the Asperger diagnosis which requires no speech or cognitive delay).
• A group (24%) who resembled people with autism but who had a late age of onset, or otherwise did not meet the criteria for autism.
• A group (52%) who were autistic-like, but displayed fewer stereotyped and repetitive behaviors.