DiffCmd is a variable needed if you want to use the version diff feature (If you are using linux you normally do not need to change the variable).
NB. You should not edit lib/default.php, where the variables can be found. Instead you should copy the variables you want to change to your own made config.php.
// config.php
// $TempDir determines the location of temp files used for computing diffs.
// The default makes a choice based on the environment
$TempDir = isset($_ENV['TMP']) ? $_ENV['TMP'] :
isset($_ENV['TEMP']) ? $_ENV['TEMP'] : "/tmp";
// $DiffCmd determines what command to run to compute diffs.
$DiffCmd = '/usr/bin/diff';
Now you change the variables to something that is correct on your machine, or if php-safemode is on maybe to where your Tavi-directory is.
see also TaviOnWindows
The same goes for Windows, but now you HAVE to change the path and possibly add .exe. To make it all simple I made these differences.
// config.php
$DiffCmd='D:/webspace/wiki/diff.exe';
$TempDir='D:/webspace/wiki/tmp';
Of course you have to create the tmp directory.
As usage of the external diff tool has been a steady source of problems and complaints there have been several suggestions to do the diffing directly in PHP or to look at how other php based wikis solve this.