By default, files uploaded using Plupload are uploaded in their entirety within a single form post. However, Plupload does have the ability to chunk files. When a file is chunked, it is split up into multiple parts, each of which is posted to the server independently. The server then has to rebuild the target file using the received chunks.
This is meant to deal with browser limitations and to allow for some fault tolerance in the file upload; in addition to the chunking, you can tell Plupload to retry failed uploads a given number of times. This way, if there is a momentary network problem, Plupload may still successfully upload the chunk, and eventually, the entire file.
View blog post about this project on my blog.