A stack is a data structure that follows the LIFO (last-in, first-out) principle, where elements can only be inserted or removed from one end called the top. The postfix notation of an expression is evaluated by pushing operands onto a stack and applying operators to pop the top two elements and push the result back on the stack, until a single value remains. The example shows evaluating the postfix expression 6 2 3 + - 3 8 2 / + * 2 ↑ 3 + step-by-step using a stack.