The Oath Rod is a ter'angreal that makes oaths sworn upon it unbreakable. Its origins are in the Age of Legends, in which it was called a Binder. It can be used only on channelers.
In the Third Age there are only two binders known. They are smooth, ivory-white cylinder shaped, a foot long and wrist-thick with odd, cursive script carved on one flat end. They feel almost like glass, cool to the touch. Every one is activated by a thin thread of Spirit added to the numeral that is carved into it.
In the Age of Legends binders were used on criminal channellers of the One Power. One such example was Semirhage, the most talented healer at that time, who also satisfied her sadistic streak on her patients, by making them experience pain during the Healing. She was offered the choice of being bound by the binder to not use again the power in such way (and so to see her remaining lifespan halved) instead to be severed (in the end her choice was to runaway turning to the Shadow).
Binders don´t work on people who are unable to channel the One Power. On such people other ter'angreal were used instead.
White Tower Oath Rod
It is used when raising Accepted to Aes Sedai, upon which they are required to swear the Three Oaths. It makes oaths binding; that is, it is not possible to knowingly break an oath sworn on the Oath Rod unless the rod is used again to release the person from it.
The Black Ajah has found a way to break the Three Oaths while retaining an ageless face: The Black Ajah uses the Oath Rod to remove their Oaths and swear three new Oaths to the Shadow. One of these Darkfriend Oaths is to "not betray the Great Lord, to keep my secrets until the hour of my death." Another Oath is to not betray the identity of any Black sisters, although the exact phrasing is unknown.
Seaine Herimon, Pevara Tazanovni, Saerin Asnobar, Yukiri, and Doesine Alwain secretly used the Oath Rod to investigate sisters and force them to reswear the Three Oaths in order to prove they were not members of the Black Ajah. As part of carrying out this task they tested themselves, Talene Minly and the rebel sisters who were spying on the White Tower sisters.
The day after the Battle of Tar Valon, during which she was involuntarily rescued from her White Tower captivity, Egwene "fetched" the Oath Rod from Saerin for two purposes: she wanted to swear the Three Oaths in front of the rebel Sitters and she wanted to use it to ferret out sisters of the Black Ajah who wandered among them. To accomplish the latter she made all rebel sisters reswear the Oaths, but to ensure that members of the Black Ajah did not escape, she kept her possession of the Oath Rod a secret until she was ready to force the confrontation.
Seaine presents to Egwene three possible ways for a Forsaken to circumvent the Oath Rod: using another Oath Rod just after taking the Three Oaths to negate them, sending another woman under the Mirror of Mists to take the Oaths, and using some voice-changing weave to make others hear the words of Oaths other than those that were really spoken.
The Oath Rod is the cause of the Aes Sedai agelessness. Although most Aes Sedai believe that the ageless look comes with the ability to channel, the Kin, the Forsaken, the Wise Ones and the damane do not have ageless faces, despite centuries worth of channeling. Egwene herself states to Romanda that the Oath Rod is the cause of agelessness. See also Source:Budapest Q&A, April 2003, close to the end of that long article for confirmation from RJ himself.
Besides causing agelessness, the Oath Rod reduces an Aes Sedai's life span by more than half. One of the members of the Kin is almost three hundred years older than Cadsuane Melaidhrin, the oldest living Aes Sedai.
Inconsistency regarding the ageless look of Aes Sedai
When Rand watches the history of Aiel through the eyes of his ancestors, the Aes Sedai with the Jenn Aiel at the half-built Rhuidean described as "Ageless faces with skin that looked as if the wind might tear it." ; which should mean that they were bound by the oath rod. On the other hand it is indicated that they are extremely old "with hair so white it almost seemed transparent" – which holds a contradiction of the life-shortening effects of the oath rod. There might be some hidden-from-readers fact explaining these, though.
Shaido Oath Rod
The second known Oath Rod is in possession of the Shaido Aiel. It was found in the Kin's Storeroom in Ebou Dar and given to Sammael by Falion and other Darkfriends. Some time after it was given to Sevanna of the Shaido Aiel, by Caddar (Sammael in disguise), although it was since seized by Therava. It was used to bind Galina Casban to the will of the Sevanna and her allies. Galina commented that it is very similar to the one in the White Tower, the only difference is the numeral impressed on it. Sammael tells to Sevanna that the rod works only on women who can channel. (He assures her that when she has al'Thor, he will give her what will control him.) 
Three more binding rods are shown to be in the possession of Moridin, among other objects of the Power he owns in his fortress in the Blight. It is not known if they are attuned to saidin or saidar as the two described above.