Masterwork weapons were extremely well-crafted weapons that were more lethal than their mundane variants. Even the most well-respected smiths and artisans struggled to craft weapons well-balanced and deadly enough to be deemed as masterworks. The production of such a weapon was considered the peak of non-magical smithing, and an indicator of supreme skill.
However, despite their superior make, masterwork weapons were still not forged with Spellcraft, and thus did not have the benefits of Enhanced Weapons. They could be destroyed with enough force, and could not damage creatures that would be otherwise resistant or immune to standard weapons, such as Fiends or Undead.