To compress a folder named fld1 u need to use
tar -cvvjf fld1.tar.bz2 fld1
Thats it.... pls not its not a necessity to give fld1.tar.bz2, u can give any name but to distinguish it as a bz2 file we name it so.
for tar.gz files
tar -cvvzf fld1.tar.gz fld1
the best place to know more is,
open a terminal & shoot "man tar"
u'll find all the options there.....
Thanks
Gokul