Wasabi is a kind of Japanese horseradish which is usually grated and used for various Japanese dishes. It is spicy and now well-known everywhere because of sushi. It is hard to get fresh Wasabi outside Japan, but it is widely available in paste form in tubes at most supermarkets in the US.
Wasabi can be very hot, but it is more like the power of hot mustard or western horseradish than chili peppers. It also has a strong effect in your nose. People who eat too much at once grab their nose! In Japan, the flavor and heat is very popular and is used in all sorts of food, such as crackers and other snacks.