For compact digital cameras aimed at beginner and intermediate photographers, optical image stabilization (sometimes shortened to OIS) is the preferred IS technology.
Optical IS uses hardware corrections to negate camera shake. Each manufacturer has a specific configuration for implementing optical IS, but most digital cameras that contain optical image stabilization use a gyro sensor built into the camera that measures any movement from the photographer. The gyro sensor sends its measurements through a stabilization microchip to the CCD, which shifts slightly to compensate. The CCD, or charge-coupled device, records the image.
The hardware correction found with optical IS is the most precise form of image stabilization. It does not require increasing the ISO sensitivity, which can compromise photo quality.