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It’s one of the new privacy options on Facebook. What it does is change who can see all of your old posts on your facebook wall. All of the other privacy settings only affect new posts you make.

If your privacy settings were already set to share status updates only with friends, most posts won’t change at all. If you had shared specific posts with a limited set of people, those posts won’t change either. Only if a particular post was set to share with everyone or with friends of friends, will it change at all. Those posts will be changed to be visible only to friends.

Past Posts

Past Posts by Wordle

To make the change, go to Privacy Settings in the Account menu. Scroll down to the heading Limit the Audience for Past Posts, the description is Limit the audience for posts you shared with more than friends.  Click on Manage Past Post Visibility, then on the pop-up window, click on the Limit Old Posts button. Another pop-up screen appears with a warning and asks Are You Sure You Want to Proceed? Click on the Confirm button and a new pop-up window confirms that the audience has been changed.

You can still go back and change individual posts to show to everyone – except now everyone is called public.