This value is the largest number of observations (sampled parameter values) that will be retained for use in estimating the posterior distribution. If sampling continues after this maximum is reached, every second observation is discarded. Sampling then proceeds, retaining one out of every two samples. If the maximum is reached again, half of the retained observations are again discarded (throwing away every second observation). Sampling then proceeds, retaining one out of every four samples. And so on.
Before the retained observations are used to estimate the posterior, some of the initial "burn-in" observations are discarded. You can choose how many burn-in observations to discard by entering a value for Number of burn-in observations.