Sensor Fusion is a process by which data from several different sensors are "fused" to compute something more than could be determined by any one sensor alone. An example is computing the orientation of a device in three dimensional space. That data might then be used to alter the perspective presented by a 3-D GUI or game.
This educational application by NXP Semiconductor teaches you about sensor fusion and lets you experiment with various fusion options. It does not REQUIRE that your Android device use NXP sensors. It is compatible with the NXP Sensor Fusion Library for Kinetis MCUs. Compatible hardware and embedded software are available at http://www.nxp.com/sensorfusion. When used without a development board, this app just lets you experiment with what you already have on your Android device.
This tool updates and replaces the "Freescale Sensor Fusion Toolbox". Freescale merged with NXP in December of 2015.