PhysX is a well-known real-time physics simulation engine used by many games, originally developed by Ageia the technology eventually got acquired by nVidia.

If you play an "PhysX" enabled game and if you dont have the required drivers installed you will encounter the following error :

"Failed to initialize the physics system. Please ensure you have an updated version of the PhysX System Software installed."

Despite the expectation that being an nVidia owned technology this must not support ATI graphic cards, the truth is there are drivers available for ATI graphic cards to enable PhsyX gameplay on a users computer.

To get past this error and play PhsyX enabled game with your ATI graphic card, all you need to do is to download and install the PhsyX Drivers for Windows, download the required driver from here - http://www.nvidia.com/object/physx_9.09.0408_whql.html?ClickID=buyumenukkyvk6muf1eyfdmuyy1d1e1gngyg

Once installed you will get rid of the error and your PhsyX games should run fine without any issues.