This buoy is used by the diver to mark their position on the surface. It is "launched" by the diver while still underwater (usually during ascent or decompression stops) and inflates as it rises. This allows the support boat to easily locate the diver and know that they are preparing to surface.
It is usually about 120 cm long and folds into a very small size, secured with an elastic strap, so it can be easily stored in the diver's BCD. It comes with a small carrying pouch.