To create a gzipped tarball archive from a given directory, use the following command:

tar -zcvf the-name-of-your-tarball-here.tar.gz source-directory-name 

This will compress the contents of source-directory-name to a tar.gz archive named the-name-of-your-tarball-here.tar.gz

To extract a tar.gz compressed archive you can use the following command 

tar -zxvf the-name-of-your-tarball-here.tar.gz 

This will extract the archive to the directory the-name-of-your-tarball-here.