A mold is never perfectly sealed. Where the core and cavity meet there's a gap of a few microns, through which a whisker-thin sliver of material can leak (flash), or a faint microscopic mismatch between the two faces leaves a thread-like line on the part's surface. That line's location is the parting line, and where it goes is decided during tool design — it has to let material fill completely and let the part release without hanging on an undercut (which ties it directly to draft angle).
Parting lines are usually routed along a part's widest cross-section — its "equator" — so the two mold halves can pull straight apart with no undercuts. A designer who knows where this line will fall can avoid putting a logo or a button right on top of it, where the seam would look sloppy — or, just as often, deliberately hide the parting line inside an existing break in the form, like a chamfer running down the side of a case.
It never shows up in a render or a 3D model, but it always shows up on the real, mass-produced part — a textbook case of something that looked perfect on screen getting a visible seam the moment it becomes physical.
When to use
Before placing a visible graphic (a logo, say) on a part that will be injection-molded or die-cast.