Microsoft used 8.3 filenames for a long time - no more than 8 characters for the name, no more than 3 for the extension. With Windows 95, they introduced the Long Filename system: filenames could be up to 255 characters long (including the extension), and LFN silently converted each longer filename to an 8.3-compatible filename for use in DOS (which still required 8.3).
LFN did this by shortening the long filename (pre-extension) to its first 6 non-space characters, adding a tilde (~), and then adding a number depending on how many similarly-named files it already had in the directory. (I believe it also kept a library mapping long extensions to 3-letter extensions.) So "My Document.docx" would become MYDOCU~1.DOC. If you had more than 9 similarly-named files, it would truncate to 5 so that the double-digit number would fit, and so on.
So for a while, the going joke was to refer to Microsoft as MICROS~1.
cc @matt