Air traffic control radar facilities use two types of radar. Primary radar, which has many limitations, basically bounces microwave pulses off objects and reads the echo. Secondary radar makes use of a transponder. The transponder responds to an interrogation from radar ground stations, relaying the airplane identification information and altitude.
Transponders have a number of different modes that respond with certain information. The majority of private planes have an A/C mode transponder. Mode A responds with the airplane identification number assigned to it by air traffic control. Mode C provides the altitude of the aircraft.
Mode S transponders relay to the ground station not only a plane's altitude but the plane's aircraft address information assigned by the FAA as well. This aircraft address is a permanent designation that makes identifying the owner of a plane easier. Mode S transponders are more sophisticated and more expensive than a typical transponder.
Mode A/C transponders are the most common models used in the United States. Mode S transponders were primarily used by the military in the past but are becoming much more common in private planes.