This setting concerns the manner of adding new members to a list.
Open gives anyone the option to sign up for the list (We do not recommend this option for most lists)
Confirm means that users can still sign up for the list. After signing up, they must first confirm that the used address is correct by answering a confirmation e-mail and leaving the header intact.
Moderate means that an administrator is required to add new users. Potential subscribers can still sign up for the list, but must be confirmed by an admin.
Confirm, then Moderate combines the two options above. Potential new subscribers must first answer a confirmation email and then be allowed to join the list by an administrator.