A defeat device is an embedded system or mechanism that attempts to dupe regulators or potential buyers. The most recent example is Volkswagen’s on-board emissions module, which detected whether a car was undergoing emissions tests and changed the functioning of the car to pass the tests.
Samsung Smart TVs have also been accused of using a defeat device:
Independent lab tests have found that some Samsung TVs in Europe appear to use less energy during official testing conditions than they do during real-world use, raising questions about whether they are set up to game energy efficiency tests. (html)
Samsung claims this is an abuse of the term.
Source: Defeat Device
More recently. Renault is facing suspicion of using defeat devices. (Link)