this is a feature which supposedly originates in ganglia and allows for network traffic reduction.
if enabled, it makes monitoring agent not send repeated values until some time based threshold is passed. server on the other hand assumes that missing values are the same as the last one and only considers agent gone if values do not come past this time thershold.

in the case of zabbix, this feature would probably be configured on item level and only work with active agents.
if value would be considered as the same (configurable margin for floats) by the active agent, agent skips sending it to the server. if (per item) time period has passed without sending another value, agent sends the value anyway, sort of a heartbeat.

server, on the other hand, after the configured time period has passed, can do two things.
1. if agent sends in the same value, server assumes that all values between the previous one and the last one are the same and fills them in. note that server probably should use a larger time period to determine whether value falls in this time period (to compensate for agent and network delays);

2. if "heartbeat" value is missing, server assumes all values since last successful transmission are missing.