Physical address extension (PAE) and Address windowing extensions (AWE) both are used to address more than 4GB memory on 32 bit systems. I define both in following lines to remove the confusion regarding this concept
Physical address extension (PAE)
PAE is used by any OS to extend more than 4 GB ram for 32 bit systems. 32 bit systems natively cannot utilize more than 4GB of physical memory. As most of the server hardware is with much more memory than 4GB, it is required to make it accessible for 32 bit operating systems. For windows platform PAE is enabled by adding some parameter in boot.ini file.
Address windowing extensions (AWE)
AWE is a windows API used for supporting 32 bit applications to access more than 4GB of memory. It may be required for memory extensive software and applications. Read about enabling PAE for SQL Server.