In genetics, an enhancer is a short region of DNA which can be bound with proteins (namely, the trans-acting factors, much like a set of transcription factors) to enhance transcription levels of genes (hence the name) in a gene-cluster. An enhancer does not need to be particularly close to the genes it acts on, but it is on the same chromosome. (An exception to this rule was published in a 1990 article in Science, where researchers Wedel, et. al., made two linked circles of DNA, one circle with the enhancer sequence and the other with its promoter. An abstract can be found here.)
An enhancer does not need to bind close to the transcription initiation site to affect its transcription, as some have been found to bind several hundreds of thousands base pairs upstream or downstream of the start site. Enhancers can also be found inside introns. An enhancer's orientation may even be reversed without affecting its function. Furthermore, an enhancer may be excised and inserted elsewhere in the chromosome, and still affect gene transcription.