Acronymy is the practice of creating acronyms, which are formed by taking the initial letters of a phrase or a group of words and combining them into a new word. Acronyms are often used to simplify complex terms or phrases, making them easier to remember and communicate. Common examples include NASA (National Aeronautics and Space Administration) and ASAP (As Soon As Possible). Acronymy can play a significant role in language efficiency and in various fields, including technology, medicine, and business.