This post explains how to integrate Twilio into a new Ruby on Rails application for handling inbound and outbound SMS messages. The process involves creating a basic controller with a default method/action called "reply", adding the twilio-ruby gem, configuring Twilio credentials and phone number in credentials.yml.enc, skipping CSRF verification and authentication token verification, instantiating the Twilio client, sending an SMS response to the user's phone number, and setting up a publicly accessible webhook using ngrok. The example demonstrates how to receive and reply to an SMS in Rails with Twilio.