The document describes an algorithm created by the author's uncle to efficiently represent data and minimize memory usage. It explains how the Huffman coding algorithm works to assign variable-length binary codes to characters based on their frequency, allowing more common characters to have shorter codes and less common characters to have longer codes. This results in compressed data that takes up less space on average than fixed-length character encodings. The author provides an example Java implementation of the Huffman algorithm to help students with homework assignments.