Using Intersection Observer for scroll-based navigation highlighting is efficient because: 1) The rootMargin of -50% effectively creates a middle viewport zone for determining the current section, 2) No manual calculations of element positions are needed, 3) The browser handles all intersection calculations efficiently, 4) It naturally handles different viewport sizes and dynamic content. The code demonstrates how to highlight navigation items based on which section is currently in view, using an optimal configuration for typical navigation scenarios.