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This article is from the Paper Money Collecting FAQ, by Bruce Giese giesewpm@tiac.net with numerous contributions by others.

2.12) Paper Money Collecting: What is a watermark?

Most countries have banknotes with watermarks. The USA added a watermark
to its new $100 note in 1996 (and some people in the USA were curious if it
was some kind of subliminal message).

A watermark is simply a design that's within the paper of the note itself
which can only be seen when viewing the note with a strong light behind it
(i.e. you can only see it when light is passing through the note). Watermarks
are an effective, although very old, anti-counterfeiting device.

 

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hobby, recreation, paper money collecting, USA paper money, world paper money