Many Japanese cars exported to North America aren't the same as the ones sold in Japan. Most obviously, the steering wheel is on the wrong side of the car. But there are many and more subtle differences, and these are the things that JDM guys and gals obsess over.
For instance, a Honda Civic sold in Japan isn't exactly the same as a Honda Civic sold in the U.S., even when both cars are built in Japan. Often everything from the badges to the motors to the equipment specifications are different. So JDM tuners will import all of the "correct" Japanese parts and install them in their cars.
While the differences can be as subtle as trim or badging, often new JDM cars are better equipped than their U.S. counterparts and include stiffer suspension and features like rear disc brakes. Many tuners and drifters prefer JDM engines too, as often American-spec engines are detuned versions of their JDM counterparts or different engines altogether. A JDM engine may have more aggressive cam timing, higher boost in turbo models, a higher compression ratio or a different engine control computer. One reason for this is that gasoline in Japan is generally of a higher octane than in the U.S.
Of course, engine swaps are some of the most radical JDM transformations, as they may not be legal or pass local vehicle inspections, especially smog tests. Some JDM engines are legal, however, and low-mileage JDM engines have long been a sort of secret among mechanics and import enthusiast.
Many Japanese motorists choose to replace their cars more often than American motorists due to rigorous and expensive bi-annual vehicle inspections that are required regardless of mileage. New cars are exempt for the first three years, so many Japanese motorists choose to replace their car rather than pay for an expensive inspection every two years. Because of congestion, high gas prices and Japan's excellent rail system, many engines pulled from Japanese vehicles have relatively low mileage, which makes them desirable for JDM tuners.
JDM has evolved into a style as well, with cars modeled after professional drift cars and Kaido racers. Many American enthusiasts now try to achieve this look, even if under the skin of their JDM "Silvia" is nothing but a stock Nissan 240SX.
JDM tuners are justifiably enthusiastic about Japanese luxury cars, as well. But since luxury brands like Acura and Infiniti were invented for Americans, they actually switch these cars "back" to their standard brands. Japanese buyers that can afford it have no problem spending good money on a luxury sedan with a Toyota or Nissan logo on the trunk lid, so tuners will replace the logos and name badges with those of the JDM equal. Some of the most common are the use of the Honda "H" logo on cars like the Integra, RSX and NSX (cars sold as Acuras in the U.S.), or converting a Lexus IS to a Toyota Altezza -- like the one pictured above.