Data tokenization is a data security technique that replaces sensitive information with non-sensitive tokens. This process ensures that the original data remains secure while the tokens retain essential information for processing. Data tokenization is widely used in industries like finance and healthcare to protect data such as credit card numbers and patient records. Unlike encryption, tokenized data cannot be reversed without access to the tokenization system, making it highly secure. It is critical for compliance with regulations like GDPR and PCI DSS. By adopting tokenization, businesses can safeguard sensitive information, reduce data breaches, and enhance customer trust.