Step 1: Break down what XML is designed to do.
XML exists to store and transport data in a structured way that is both human-readable and machine-readable, using tags in a manner somewhat similar in spirit to HTML.
Step 2: Focus on why the word extensible fits so well.
Unlike HTML, which only offers a fixed set of predefined tags, XML lets you invent your own tag names to describe whatever data you happen to be working with, which is precisely what makes it extensible rather than fixed.
Step 3: Assemble the full expansion of the acronym.
Combining this extensibility with the fact that it still uses tags to mark up data gives the full name Extensible Markup Language, which matches the acronym XML exactly.
\[ \boxed{\text{Extensible Markup Language}} \]