Secure Sockets Layer (SSL) and its successor Transport Layer Security (TLS) are cryptographic protocols that provide security for communications over networks such as the Internet.
SSL is used to encrypt data, authenticate the server and verify the integrity of messages. SSL uses a cryptographic system that uses two keys to encrypt data - a public key known to everyone and a private or secret key known only to the recipient of the message. When data is transmitted using SSL, it enters a kind of tunnel that makes the information invisible to anyone other than the target for the data exchange.
Knowing that a Website uses SSL to secure communication ensures that the data submitted to the Website is securely transferred between your browser and the intended Website.
See also, How does Internet security work?