RAID-Z is a data/parity scheme like RAID-5, but it uses dynamic stripe width. Every block is its own RAID-Z stripe, regardless of blocksize. This means that every RAID-Z write is a full-stripe write. This, when combined with the copy-on-write transactional semantics of ZFS, completely eliminates the RAID write hole. RAID-Z is also faster than traditional RAID because it never has to do read-modify-write.

Read more: RAID-Z : Jeff Bonwick's Blog