V.A.T.S or the Vault-Tec Assisted Targeting System is a feature in Fallout 3 and Fallout: New Vegas. V.A.T.S allows the player to pause the game and aim and fire at specific body parts on their enemies, the amount of shots you can take at once will depend on your Action Points. If you don't have enough action points to kill your enemy you'll have to come out of V.A.T.S mode and wait for you action points to regenerate.
Most enemies will have 7 body parts to aim for (head, torso, left arm, right arm, left leg, right leg and the weapon your enemy is holding) but some bugs or mutants will only have three or four. When aiming, each body part will have a percentage next to it, this tells you the chance you have of hitting that body part. 95% is the maximum percentage available and means it's almost certain you'll hit your target. The closer you are to your enemy the higher the percentage will be. There's also a bar above the percentage which shows how much damage the enemy has taken to that specific body part, if the bar is empty it means that the body part is crippled.
A new feature added in Fallout: New Vegas is that all melee weapons have a unique attack that can be performed against enemies in VATS. For example, in the New Vegas demo, a 9 Iron golf club was shown to have a unique attack called "Fore!" This move is when the Courier swings the golf club upwards and hit the enemy's groin.
In Fallout 3 VATS has a green color scheme, in Fallout: New Vegas it has an orange/yellow.