Ice wine has a higher concentration of sugar in the wine, which gives the wine its sweet profile. The reason for the sweetness comes from the freezing of the grapes. The water in the grape freezes, but the sugars and other solubles do not. When the grapes are pressed, a more concentrated must is produced. Only healthy grapes with a brix level (a measure of sugar in the grape) of 35 or higher can be used for ice wine. Grapes with a lower brix level are usually given the designation "select late harvest". The high sugar levels are balanced with high acidity, producing a crisp flavor.
Some winemakers have tried mechanically freezing the grapes to produce ice wine. This process is called cryoextraction. In Austria, Canada and Germany, the grapes must freeze naturally to be called ice wine. These wines are often called "icebox" wines. There are also several "ice wine style" kits that one can make at home. These kits reproduce the conditions for ice wine, but are not true ice wines. They are however a very good approximation, and are a very popular wine kit to make.
The most common grape traditionally used for ice wine is Riesling. This may be from the ice wine's origins in Germany. Now ice wines are made from a large variety of grapes from Chardonnay to even red grapes such as Shiraz (Syrah). There are even a few sparkling ice wines from Canada.
The ice wine has a very fruity, crisp taste when consumed young. When the ice wine is aged, the wine flavors change to jam, honey, and Carmel. This has created some debate on when an ice wine is best opened. Either way, the taste is a very unique experience.