This is the Dutch National Flag problem. We use three pointers: l (boundary of 0s), r (boundary of 2s), and i (current element).

1. l = 0, r = len(nums) - 1, i = 0.
2. While i <= r:
   • If nums[i] == 0:
     • Swap nums[l] and nums[i].
     • l += 1, i += 1.
   • Else if nums[i] == 2:
     • Swap nums[r] and nums[i].
     • r -= 1. (Don't increment i as the swapped value needs checking).
   • Else (nums[i] == 1):
     • i += 1.

• Time Complexity: O(N).
• Space Complexity: O(1).

def sort_colors(nums):
    l, r = 0, len(nums) - 1
    i = 0
    
    def swap(i, j):
        tmp = nums[i]
        nums[i] = nums[j]
        nums[j] = tmp
        
    while i <= r:
        if nums[i] == 0:
            swap(l, i)
            l += 1
            i += 1
        elif nums[i] == 2:
            swap(i, r)
            r -= 1
        else:
            i += 1