Equivalence partitioning is a black box testing technique that divides input data into equivalent classes and designs test cases to cover each class. It aims to test typical, boundary, and invalid cases to improve test coverage. The key steps are to identify the input range, divide it into logical partitions, and design test cases for typical values within each partition as well as boundary and invalid values. This technique helps reduce the number of test cases needed while still thoroughly testing an application's functionality across different input conditions.