Mux Player now supports chapters, allowing users to split videos into titled sections for easy navigation. To create chapters without manual input of timestamps, a Node.js script can be used in conjunction with OpenAI's AI LLM (large language model). The process involves uploading a video to Mux and enabling auto-generated captions, then using the captions as input for the AI LLM to generate chapter titles and timestamps. This automation simplifies the process of creating chapters for videos and enhances user experience by allowing them to quickly access content they are most interested in.