clipped from: science.howstuffworks.com   

The term "liquid body armor" can be a little misleading. For some people, it brings to mind the idea of moving fluid sandwiched between two layers of solid material. However, both types of liquid armor in development work without a visible liquid layer. Instead, they use Kevlar that has been soaked in one of two fluids.

The first is a shear-thickening fluid (STF), which behaves like a solid when it encounters mechanical stress or shear. In other words, it moves like a liquid until an object strikes or agitates it forcefully. Then, it hardens in a few milliseconds. This is the opposite of a shear-thinning fluid, like paint, which becomes thinner when it is agitated or shaken.