Ah, "That's what she said." The phrase that has single-handedly fueled awkward silences and bursts of laughter in equal measure. But what's the deal with this ubiquitous expression? Essentially, it's a comedic device used to inject a sexual innuendo into an otherwise innocent statement.
The humor lies in taking a sentence out of context and reinterpreting it with a suggestive undertone. For example, if someone says, "It's really long and hard," the phrase can be appended to imply something entirely different than the original intended meaning (maybe they were just talking about a math problem!).
Its popularity stems from its simplicity and universal applicability. Almost any statement with double meaning potential can be a target. However, use it wisely! While it can be a great icebreaker or a lighthearted joke, it can also easily fall flat or even be perceived as inappropriate depending on the context and audience. Know your crowd, and use your innuendo-powers for good (or at least, for harmless fun)!