This is an Apache directives file. It is used to modify the way Apache behaves for a specific directory.
Examples of how .htaccess is used:

• password protected directories
• IP denying to protect against spammers
• hotlink protection for images

Many of these tasks can be accomplished through using your cPanel, which will generate the appropriate entries in the .htaccess file.

Mambo includes a file called htaccess.txt. This file contains the directives that allow SEF URL's to function. If you intend to activate SEF URL's through your global configuration, you must first rename the htaccess.txt file to .htaccess (Note: it does not have an extension. Just rename to .htaccess and save as "All Files" without any .txt or other extension on the end).