Format-transforming encryption - Definition from the Hotspot Shield Glossary
Format Transforming Encryption is a form of data encryption where the encrypted text can be configured. In FTE both the original input text i.e. the plain text and the output text i.e. the cipher or encrypted text can be configured.
Essentially a user can choose what format the text is encrypted into giving them greater control and flexibility over the encryption process. Format Transforming Encryption does not require the input and output data be listed as the same format and the process is used in certain applications to get around deep packet inspection.