That's an interpretation from physics in the context of information theory. Leonard Susskind's Black Hole War explains some of these concepts, and I researched it further for a project getting my B.S. in physics. It's been a while but I'll do my best to break it down.

Imagine that a murder has happened and the murderer wants to cover up the crime. The gun and body contain physical information that the cops could use to reconstruct the murder, so the killer throws them in the river.

Why is the river useful to the killer? Because it's a chaotic (entropic) system that contains a bunch of particles doing all sorts of things. The information contained in the gun isn't actually lost or destroyed, it's just made harder to access by mixing it with this "junk" information. Likewise, the blood of the body mixes with with the water and is diluted to the point of being impossible to find, but the it isn't actually destroyed, it's just mixed in.

Suppose we could freeze time and examine that river down to the particle level. If we found a single particle of blood, we could look at it's position and momentum, and that of every particle it interacted with, and we could trace it all the way back to the body (this might be easier to understand if instead of a river, we say the water is crystal clear and uniform). Obviously, this isn't something that could be done feasibly, but theoretically, there's no reason you couldn't put Humpty Dumpty together again.

When you put two liquids in a flask and shake it, the information of precisely how you shook it is contained in the particles in that liquid. Every particle now has a story: before, they were sitting around with all their particle friends but then the shake happened and everyone wound up in a slightly different location because of the precise way that the shake affected them as opposed to their neighbors. The information about the shake is there in the particles in the flask.

To say that a system is more entropic is to say that more physical events have happened in that system. The particles become more dispersed because more things have happened to them leaving behind physical impressions that become harder and harder to trace back as the amount of things that have happened to that system increase, because there's more information to sort out. This is where we can think of entropy as "a record of everything that's ever happened."

Still with me? Ready for extra credit?

Can physical information ever actually be destroyed, erased from the universe entirely, as opposed to just being scrambled? That's the question at the heart of one of the biggest unresolved paradocies in the modern understanding of physics: The Black Hole Information Paradox.

If you commit a murder on a spaceship and then fly that spaceship into a black hole, is there any way, even theoretically, to recover the information of what happened on that spaceship? Has the information merely been scrambled like the body in the river, or is it truly destroyed and erased from the universe entirely? If it is just scrambled, then where is that information contained?

This is what Susskind's book I mentioned before is all about. Stephen Hawking once maintained that the information was completely erased, while Susskind argued that this was incompatible with quantum mechanics and the second law of theromodynamics, that by erasing information, entropy was being decreased in a closed system. Hawking later changed his position and conceded that he'd been mistaken. Today, it's believed that the information is scrambled, but what nobody knows is where the information is contained, and every proposed solution seems to contradict some fundamental aspect of our understanding of physics.