One of the drawbacks of Magento is currently its speed if default configuration is used. There are certain ways of making it run faster. The best one is to enable GZip compression by changing .htaccess file a little. You just need to uncomment part of the code. In my case, the speed increase was exactly 235%. Let’s start speeding up Magento!

Find the following lines in your Magento .htaccess file and replace them with the following code.

############################################
## enable apache served files compression
## http://developer.yahoo.com/performance/rules.html#gzip

# Insert filter
SetOutputFilter DEFLATE

# Netscape 4.x has some problems…
BrowserMatch ^Mozilla/4 gzip-only-text/html

# Netscape 4.06-4.08 have some more problems
BrowserMatch ^Mozilla/4.0[678] no-gzip

# MSIE masquerades as Netscape, but it is fine
BrowserMatch \bMSIE !no-gzip !gzip-only-text/html
# Don’t compress images
SetEnvIfNoCase Request_URI .(?:gif|jpe?g|png)$ no-gzip dont-vary

# Make sure proxies don’t deliver the wrong content
Header append Vary User-Agent env=!dont-vary

# enable resulting html compression
php_flag zlib.output_compression on

(Source: http://inchoo.net/ecommerce/magento/boost-the-speed-of-your-magento/ )