Generalized gradient approximations (GGA s) seek to improve upon the accuracy of the local-spin- density (LSD) approximation in electronic-structure calculations. Perdew and Wang have developed a GGA based on real-space cutoff of the spurious long-range components of the second-order gradient ex- pansion for the exchange-correlation hole. We have found that this density functional performs well in numerical tests for a variety of systems: (1) Total energies of 30 atoms are highly accurate. (2) Ioniza- tion energies and electron aSnities are improved in a statistical sense, although significant interconfigurational and interterm errors remain. (3) Accurate atomization energies are found for seven hydrocarbon molecules, with a rms error per bond of 0.1 eV, compared with 0.7 eV for the LSD approxi- mation and 2.4 eV for the Hartree-Fock approximation. (4) For atoms and molecules, there is a cancellation of error between density functionals for exchange and correlation, which is most striking whenev- er the Hartree-Fock result is furthest from experiment. ( 5) The surprising LSD underestimation of the lattice constants of Li and Na by 34% is corrected, and the magnetic ground state of solid Fe is re- stored. (6) The work function, surface energy (neglecting the long-range contribution), and curvature en- ergy of a metallic surface are all slightly reduced in comparison with LSD. Taking account of the posi- tive long-range contribution, we find surface and curvature energies in good agreement with experimen- tal or exact values. Finally, a way is found to visualize and understand the nonlocality of exchange and correlation, its origins, and its physical effects.