Data tokenization is a critical security technique that replaces sensitive data with non-sensitive placeholders, reducing the risk of exposure. This blog explains how data tokenization works, its advantages over encryption, and its role in regulatory compliance, such as GDPR, HIPAA, and PCI-DSS. We also explore common use cases across finance, healthcare, and e-commerce, where protecting credit card numbers, personal data, and health records is essential. Learn about different types of tokenization (vault-based, vaultless), implementation challenges, and how it fits into a broader data privacy strategy. Whether you're building secure systems or seeking compliance, this guide offers a complete overview of tokenization's importance in modern data protection.