This is basically the software representation of a given map of language characters. The English language, not having lots of different letters, can be represented by 8 byte construct, which give you about 256 characters. Enough to cover all the letters and punctuation signs. Most browsers and computer systems would default to this if not specified.
In HTML4, it is specified as:
<meta http-equiv="Content-Type" content="text/html; charset=utf-8">
In HTML5, the specification is: