About Gray Water (Grey Water)
Gray water (or grey water) is what waste water is called when it comes from non-biohazard areas. So your laundry machine, sinks and shower/tub effluent is considered gray water. The toilet water (once you’ve flushed) is considered “black water.”
Gray water can be channeled and reused in a variety of ways. For instance, you can plumb your sink so that it feeds the water from washing your hands into your toilet tank. That way it will get one more use before becoming black water, and you won’t be flushing potable (drinkable) water down the toilet.) Keep in mind that ALL WATERING entering your home is drinkable. So you are washing, flushing and watering the garden with water that you COULD drink. Because of how valuable drinkable water is, many people and municipalities are trying to figure out how to make sure we all have drinkable water for many years to come. This is where gray water reusing comes into play.
The most popular reclamation use of gray water is for gardens. Assuming you are only using non-toxic soaps, detergents and cleaners, your gray water is more than safe (and in fact may even be nutritional) to your plants. However, gray water systems are complicated by the fact that many municipalities are not yet up to speed on how to allow residents to install these systems in a legal and sanitary fashion.
For more information on gray water systems, some pre-packaged options and the current legality issues read these two articles. The two together are very comprehensive.