This circuit is a flip-flop or latch, which stores one bit of memory. When you click the set input, it goes low, and this brings the Q output high, even after the set input goes high again. When you click the reset input, it goes low, and this brings the Q output low. If set and reset are high, then the output stays the same as when it was last set or reset.
Next: Clocked SR Flip-Flop
Previous: 7-Segment LED Decoder