Buddy Allocation is a memory management technique used in computer systems to efficiently allocate and deallocate memory. It works by dividing memory into blocks of various sizes, typically in powers of two. When a request for memory is made, the system finds the smallest available block that can accommodate the request, minimizing wasted space. When memory is freed, Buddy Allocation pairs adjacent free blocks, or "buddies," to form larger blocks. This merging process helps maintain a more organized memory structure and reduces fragmentation, allowing for better performance in memory-intensive applications.