A watermark is an image which appears on fine papers or on some documents to prevent counterfeiting. The watermark is designed to appear only when the paper is held at a particular angle, or against a black background. Standard paper usually does not include a watermark, as making a watermark will drive the cost of the paper up. Fine art papers use watermarks to identify the manufacturer, and companies such as banks frequently use specially watermarked paper for security.
There are two types of watermarks: true watermarks and artificial watermarks. A true watermark is applied during the paper manufacturing process using a special tool called a dandy roll. The dandy roll is pressed against the paper pulp while it is drying, and marks on the dandy roll will transfer to the paper pulp, creating an image. This image is called a watermark because it is made while the paper pulp is still wet with water.
An artificial watermark is applied during the printing process. Artificial watermarks are made using specially formulated inks or varnishes which will only show up at certain angles or under certain conditions, such as black light. These watermarks are cheaper than true watermarks, and can be easily customized for individual uses. They are also easier to fake by skilled counterfeiters. Personal checks and official documents such as passports often use artificial watermarks.
For an example of a security watermark, hold a piece of currency to the light. As you turn the paper to change the viewing angle, a faint image will appear. Depending on the nationality and the denomination of the currency, the watermark will change: but you will note that it is difficult to fake. Usually currency uses true watermarks in combination with specialized engravings to minimize the risk of copying.
When applied to fine art papers, a watermark tells the consumer who manufactured the paper, assuring a certain quality. Usually a manufacturer's watermark is a stylized logo, although in some cases the watermark may include general information about the paper such as recycled content and name of the paper. Sometimes, fine art papers may use a watermark to create a unique pattern which covers the entire sheet of paper. Such so-called laid stock papers often have a fine grid of lines or another such ornamental pattern.