In chess, compensation is the typically short-term positional advantages a player gains in exchange for typically material disadvantage. Short-term advantages involve initiative and attack.

Compensation can include:

A rook on the seventh rank (the opponent's second rank) is usually very powerful, as it threatens the opponent's unadvanced pawns and hems in the enemy king. A rook on the seventh rank is sufficient compensation for a pawn (Fine & Benko 2003:586). In this position from a game between Lev Polugaevsky and Larry Evans, the rook on the seventh rank enables White to draw, despite being a pawn down (Griffiths 1992:102–3).

A famous 1960 game between future world champions Boris Spassky and Bobby Fischer began with a King's Gambit opening. White sacrifices a pawn on his second move:

reaching the position shown (first diagram). Fischer examines an alternate fifth move for Black:

reaching the position shown (second diagram), where Fischer explains "White has more than enough compensation for the pawn." (Fischer 2008:123)

Possession of the bishop pair often yields long-term compensation for sacrificed material.

An unbalanced position has arisen straight out of the opening, in which, with an open center, Black has a pawn and the bishop pair for the exchange.