An engine's tendency to knock is influenced most by its compression ratio, although combustion-chamber design also has a large effect. A higher ratio extracts more power during the expansion stroke, but it also creates higher cylinder pressures and temperatures, which tend to induce knock. In supercharged engines boost pressure behaves the same way. That's why the highest-performance engines require higher-octane fuel.
If you feed such an engine a fuel with insufficient octane, it will knock. Since it is impossible, for now, to change an engine's compression ratio, the only solution is to retard the ignition timing (or reduce boost pressure). Conversely, in some engines designed for regular fuel, you can advance the timing if you burn premium, but whether this will yield additional power varies from engine to engine.
Knock sensors are used in virtually all new GM, Ford, European, and Japanese cars, and most DaimlerChrysler vehicles built today. According to Gottfried Schiller, director of powertrain engineering at Bosch, these block-mounted sensors—one or two of them on most engines and about the size of a quarter—work like tiny seismometers that measure vibration patterns throughout the block to identify knock in any cylinder. Relying on these sensors, the engine controller can keep each cylinder's spark timing advanced right to the hairy edge of knock, providing peak efficiency on any fuel and preventing the damage that knock can do to an engine. But, noted Schiller, only a few vehicles calibrated for regular fuel can advance timing beyond their nominal ideal setting when burning premium.
Older or less sophisticated cars with mechanical distributors do not have the same latitude for timing adjustment as distributorless systems do and therefore may not always be able to correct for insufficient octane or additional octane.