Google makes extensive use of auto-correction in its search engine and often automatically displays results for the auto-corrected words when its algorithm is reasonably sure that it understands what your really meant to write. In Chrome, however, the built-in spell checker is not very smart and often displays non-sensical suggestions (or provides no suggestions at all). The latest developer version of Chrome, however, can now make use of Google's server-based spell checker, which greatly improves Chrome's default spelling suggestions.
If you are using the developer channel of Chrome, you will now see the option to "ask Google for suggestions" when you right-click on a misspelled word. Once this feature is turned on, Chrome will automatically go out and retrieve suggestions from Google's servers. This means that you sometimes have to wait a second before the right word appears.
In our tests, though, the suggestions coming from Google's online spelling service were generally better than those from Chrome's built-in spell checker. In many cases, for example, Chrome now actually showed suggestions for words that stumped the built-in spell checker.
Sending All Your Misspelled Words to Google
Depending on how worried you are about your privacy, this may obviously not be a feature for you. All your misspelled words, after all, will be send to Google's servers. Google's privacy page for Chrome doesn't currently explain how Google handles this data (likely because it's only in the developer version right now).
To install the developer version of Chrome, head over here and look for the right version for your operating system.