It is a way of using data that is directly placed inside of the script within the __DATA__ section of the file.

It works like a filehandle but does not need to be opened or closed.

For example,

use strict;
use warnings;

while (<DATA>) {

  # works just like a file
  my $line = $_;

  # removes line feed
  chomp($line);

  # ..... add your code here

  print "LINE: $line\n";

}

__DATA__
Line 1
Line 2
Line 3
Line 4
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You do not need to open it, but - according to the documentation - you should close it yourself:

"The filehandle is left open pointing to the contents after __DATA__. It is the program's responsibility to close DATA when it is done reading from it." (Special Literals, as linked by Anonymous Monk).

cheers, si_lence

Which is to say that you can close the file handle to release the resources it uses, but Perl will do so automatically when the program exits if it's still open.

Tutorials: Getting Started with Perl