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In this episode of Practical Bash and Terminal Skills, we learn about the TR command which can be used to replace, delete, and trim characters from strings. Initially misunderstood as standing for "trim," it actually means "translate characters." TR takes two arguments - the source and the target strings. It can be used to replace specific characters in a string, such as replacing "I" with "1". This command can also be used with other characters for various transformations.