Meet Lighttpd: it is a fast, small footprint and higly configurable webserver with advanced features. It's often a common alternative to Apache. At the time of writing the latest versions from the 1.4.x branch is considered stable while Lighttpd 1.5.0 is an ongoing work with new features.
One new feature is the mod_deflate server module which is a modified version of mod_compress shipped with 1.4.x versions. mod_deflate can compress any output from lighttpd static or dynamic - that is, lighttpd can compress the output of dynamically generated pages with this.
Websites with lots of dynamically generated content receive significant bandwidth saving with dynamic output compression, and visitors of those websites benefit faster page loading times.
There are patches available which makes building a version of Lighttpd 1.4.x from source which includes mod_deflate.