What it means
Together with the ask, it forms the quote. When you sell at market, you receive the best bid.
In practice
The bid is where a market sell order fills and where a buy limit order waits. Selling at market gives you the bid immediately; placing a sell limit above it means waiting for a buyer willing to pay more.
A bid that keeps stepping higher while sellers are absorbed is a sign of demand. The size waiting at the bid, shown in the order book, tells you how much can be sold before price has to drop.
What to watch for
The bid is not the real price any more than the ask is. In a thin market the two can be far apart, and the last traded price on your screen may be a level you can no longer trade at.