In Windows 7, the Network and Sharing Center applet of the Control Panel allows you to set a network location which determines the computer’s security levels. The network location options are Home, Work, or Public network.
Home means your computer is in a trusted area which allows for every other system in that network can communication without restriction to that devices.
Work means that you can see other devices on the network but some capabilities of Windows are restricted. For example, you won’t be able to join a HomeGroup if your network location is set to “Work.”
A public network location is the most restrictive. This setting attempts to make your device invisible to other on the network and will block external connections to your device. This is meant for when you are in public spaces such as a coffee shop or airport.
Windows 8/8.1/10
Network locations has been simplified in Windows 8/8.1/10. There are now only 2 options of private and public.
Private allows your to connect and share resources between devices.
Public restricts other devices from connecting to your device or use services running on your device.
The network locations setting in Windows 8/8.1.10 is configured in Setttings > Network and Internet Status > Change Connection Properties.