Encoding of electronic data to take up less storage space. For example, short names in fixed length fields waste a lot of space. A simple method called run length encoding converts the spaces into a code that indicates how many blanks follow.

Data compression can be performed by two major techniques, namely statistical or dictionary. The Huffman coding and LZW (Lempel-Ziv-Welch) methods are widely used examples of each respectively.

See also DECOMPRESS.