A warp station is typically the final level of a custom level set which, upon completion, will warp the player back to the first level via means of data resetting. It is used to avoid the Termination Glitch and is used as an alternative to a dummy level.
How it works
When the current level is less than 256, resetting the data stored in coordinate [0, 32] will set the level number back to zero. Since levels 0 and -1 do not exist, if Chip dies, restarts, or tries to go to the previous level, the Termination Glitch still results. Chip's Challenge does not check this data until it tries to begin another session, so the game does not crash the instant the red button is hit.
Since the internally stored level number is zero, when the exit is reached, no level bonus is scored. Usually, a warp station is also untimed so that it adds no points to the score, and is also made extremely simple (sometimes simply walking a straight path into the exit) to avoid the possibility of Chip being killed or running out of time or the level becoming cooked.
Presently, warp stations are rarely used. There are only two known warp stations in the library of custom level sets, neither of which functions currently.
Starfire's levelset once ended with a warp station, but it has been replaced with a dummy level containing only the hint Warp station down currently... A former version of pi^2.dat also contained a warp station, but it also has been removed from the set. On David Stolp's scoreboard, he suggests not using warp stations in sets uploaded there.
Warp stations and dummy levels are unnecessary nowadays with programs such as CCLM and ChipEnd, which allow the player to set the final level, and Tile World which avoids the Termination Glitch entirely.