According to Wise-Geek:
Polyurethane, or urethane, is a material that is used for its beneficial properties of toughness, durability, and rubber-like elasticity. Since the material can range between soft and hard, urethane products can replace other objects that might otherwise use a different material, such as plastic, metal or rubber. Other beneficial properties of the urethane application include abrasion resistance, resistance to oils and solvents, high capacity of load bearing, strong tear resistance, strong weather resistance, and an extended life. These beneficial properties mean that polyurethane wheels are some of the most common types of wheels used in machinery and mechanized jobs. They may also be found on common household items like skateboards, or commercial machines like escalators.
Prior to the utilization of urethane wheels, roller skates and skateboards once used metal or wooden wheels that proved to be inefficient, noisy and expensive to construct and replace. A plastic wheel was then used, but proved to be brittle and hard; it would crack on harsh impacts and as a result of sliding friction. Urethane wheels then became commonly used for roller skates and skateboards and, even being as hard as the plastic wheels, did not suffer as much abrasion as quickly or crack on harsh impact and under sliding friction. These wheels also have a concentrically imbedded bearing for easy replacement and wheel rotation. One of the disadvantages of using urethane wheels on roller skates and skateboards is that they do not grip as much as other types of wheels.
In transportation devices like escalators, where wheels are often used to drive the process, it is important that the device have strong urethane wheels. These wheels were and are still used on escalators, but the composition of the material is much stronger than it was in urethane wheels of the past. They are high traction, cured, and made of polyurethane polymers, forming an extended chemical chain. The urethane wheels proved to be highly abrasion resistant compared to wheels made of metal, plastic, or rubber.
Urethane wheels are also used in woodworking and metal shops as a replacement for devices that could use metal or some other hard material. One type of these wheels is deformable and highly flexible, being used in processes like polishing, deburring and finishing metal products. The urethane wheels also resist expansion as a result of centrifugal force and are highly dense, allowing them to last between three and five times longer than standard, spiral finishing wheels used for metal finishing, polishing and deburring. Wheels used for these purposes are composed of materials found in plastics and use very little filler.