Layer > Make Fill Layer creates a new spot-color layer whose color is the same as the current frame's background, and inserts that layer as the parent of the current layer (which we will call the "outline layer" here).
It then attempts to make the fill layer opaque only under the outline layer's content. It does this using a "flood fill" of transparency, starting from the upper-left corner of the frame and stopping when it hits content in the outline layer.
It then deflates the fill layer, so it's easier to grab and move.
All three of these actions - inserting the new layer, auto-filling, and deflating - are undoable.
See Fill Layers for why you'd want this command and how to use it.
Make Fill Layer is only enabled when the current layer is a local bitmap layer.