Mapwindow uses the Proj4 projection library (proj.dll). More information can be found at OSGeo PROJ4  .
Setting Your Project Projection
The project projection can be set using File/Settings/Project Projection. Then set the Category, Group and Name of the projection you are using.
Important Notes on the 7 Parameter Helmert Transformations (towgs84)
1. Projection strings - a work in progress. Many of the Proj4 projection strings used in MapWindow (clsProjections.vb) are based on those at SpatialReference.org  but many of these are missing the Helmert Transformations (towgs84) parameters. Towsgs84 parameters for European countries can be found at CRS-Geo  . These parameters are slowly being added to MapWindow's projection strings - with the help of local MapWindow users. If you find that your country projections are out by say 100-200 meters then enter a bug report at Mantis .
2. ESRI generated .prj files do not conform to Open GIS standards for Well Known Text (wkt). The .prj files generated by ArcGIS do NOT contain towgs84 information. It should be standard practice for ArcGIS users to reassign projection to ArcGIS shapefiles and grids when opening these in MapWindow. To do this (e.g. for a shapefile):
(a) Make a backup of the ArcGIS .prj file. (b) Load the GIS Tools plugin in MapWindow (Plug-ins/GIS Tools) (c) Choose Gis Tools/Vector/Assign Projection to Shapefile. (d) Follow the wizard to assign the projection (e) This will (or should - see Note 1) create a new .prj file with the correct towgs84 parameters included
3. Projecting from one projection to another may lose wgs84 information. From PROJ 4.6.0 onwards, no datum shift is applied if either the source or destination coordinate system have no datum definitions (see discussion at Maptools ). When projecting a shapefile or grid that is not originally in WGS84 Geographic (Lat/Lon) use the following procedure:
(a) Project your shapefile or grid back to WGS84 (Lat/Lon) (b) Then project to the new projection. This two step process: originalProj->WGS84(Lat/Lon)->destinationProj will avoid the loss of towgs84 parameter information.