What is spooling?

The term "spool" is an acronym of "Simultaneous Peripheral Off-line Output Listing". Spooling is a process of transferring data by placing it in a temporary working area and using it when necessary.

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When a job is executed, the operating system satisfies its requests for cardreader 
input by reading from the disk and when the job requests the printer to 
output a line that line is copied into a system buffer and is written to the disk. 
When the job is completed, the output is actually printed. This form of processing 
is called spooling i.e. simultaneous peripheral operation on-line. Spooling, uses 
the disk as a huge buffer, for reading as far ahead as possible on input devices 
and for storing output files until the output devices are able to accept them. 
Spooling is also used for processing data at remote sites. The CPU sends the 
data via communications paths to a remote printer. The remote processing is 
done at its own speed, with no CPU intervention. The CPU just needs to be 
notified when the processing is completed, so that it can spool the next batch of 
data. 
Spooling overlaps the I/O of one job with the computation of other jobs. Spooling 
has a direct beneficial effect on the performance of the system. Spooling can 
keep both the CPU and the I/O devices working at much higher rates