In SketchUp, everything you create is formed from a wire frame over which a skin is stretched. You can see this process happening when you draw any shape with the pencil tool. The lines are the frame and when a shape (polygon) is complete, the frame receives a skin (surface). Even complex objects are made up of flat polygons, but their edges are hidden so you cannot see them. Go to View | Hidden Geometry to see what I mean. Low polygon modeling is where you create things in SketchUp while constantly striving to keep the amount of polygons to a minimum. The following screenshot shows how to set this up:

Have you ever downloaded a huge model from the 3D Warehouse and found that SketchUp becomes unresponsive? Low polygon modeling makes the difference...