Question

I am curious to understand what all things a compressor like yui-compressor do to compress a js or css file, what steps do i need to take if i want to write my own compressor.

Answer 1

The YUI Compressor is written in Java (requires Java >= 1.4) and
relies on Rhino to tokenize the source JavaScript file. It starts by
analyzing the source JavaScript file to understand how it is
structured. It then prints out the token stream, omitting as many
white space characters as possible, and replacing all local symbols by
a 1 (or 2, or 3) letter symbol wherever such a substitution is
appropriate (in the face of evil features such as eval or with, the
YUI Compressor takes a defensive approach by not obfuscating any of
the scopes containing the evil statement) The CSS compression
algorithm uses a set of finely tuned regular expressions to compress
the source CSS file. The YUI Compressor is open-source, so don’t
hesitate to look at the code to understand exactly how it works.

Source: http://developer.yahoo.com/yui/compressor/#work