"Content Type Conditions" shows content type conditions for the current content type. Content type conditions are used for usage definition.
Example:
List "Contacts" on SharePoint use two content types "Person" and "Company". These content types are set as "SharePoint List Content Types". If conditions are not set, both content types can be used for metadata and the program show the list of content types to the user.
If conditions are set for content type "Person" ("Type"="1" ===> Contact type = Person)
for content type "Company" ("Type"="0" ====> Contact type = Company)