Here's an update to my Fast Pass Thesis I wrote several years ago incorporating the new "time window" rule:
Disney Fast Pass is a free service offered at many of the more popular Disney attractions within each of the four theme parks. Not all attractions have it, but the ones with typically the longest lines do. Here's how it works:
At the entrance of each Fast Pass attraction, there is a set of machines that look like ATM machines. You simply insert your theme park ticket into the Fast Pass machines, and out comes your Fast Pass (be sure to get one for everyone in your party). On the Fast Pass is a "return time" window. When the time on the Fast Pass arrives, simply go back to the ride and enter the que line through the special "Fast Pass" entrance (located somewhere near the main que line). This line is typically much shorter and you practically move to the front of the line (or almost to the front in some cases) on the ride.
As far as frequency goes, you may obtain additional Fast Passes throughout the day after your initial one is used OR after waiting two hours from obtaining your most recent one.
For instance, if you obtain a Fast Pass at 9:30 AM and it's return time is 10:15 AM, when that time arrives, you'll be able to obtain another Fast Pass for that or another attraction. Also, if you obtain a Fast Pass at 9:30 AM, but it's return time is 2:00 PM, when 11:30 AM arrives (two hours after obtaining the first one), you may obtain another Fast Pass for that or another attraction.
New Policy beginning March, 2012: Once the "time window" arrives on a Fast Pass, it can now only be used during that window and can no longer be saved for later in the day. For instance, if your Fast Pass window says "10:05 AM to 11:05 AM" for the return time, you must use that Fast Pass within the time window of 10:05 AM to 11:05 AM with just a few minutes grace period on the tail end. You can no longer wait to use it later in the day as you once could. The one-hour time window is now being enforced.
Here is a list of the Fast Pass attractions in each Disney park:
Magic Kingdom: Jungle Cruise, Splash Mountain, Big Thunder Mountain Railroad, Peter Pan's Flight, Mickey's PhilharMagic, Many Adventures of Winnie the Pooh, Space Mountain, Buzz Lightyear's Space Ranger Spin, Stitch's Great Escape.
Disney Hollywood Studios: Toy Story Midway Mania, Indiana Jones Stunt Show, Star Tours, Voyage of the Little Mermaid, Rock & Roller Coaster, Tower of Terror, Lights, Motors, Action stunt show.
Hope this helps you understand how Fast Pass works.