Cyclic encoding is a method of error detection and correction that uses redundancy by adding extra bits of information to transmitted data blocks. It divides data into fixed-length blocks and appends a cyclic redundancy check (CRC) to each block by performing a modulo-2 division and XOR operation on the data. At the receiver, the CRC is recalculated and compared to detect errors, with mismatched CRCs indicating errors. MATLAB's crcgen function can generate CRC codewords.