Basically, zero hold-over and -under.
To understand this, remember the bullet starts dropping the instant it leaves the barrel. If your sights were aligned parallel with the bore, the bullet would start out lower than the line of sight and get lower as it goes down range.
To compensate for this, you adjust the sights so they are looking down, relative to the bore line. When you aim at a target, the result is the bore is tilted up, and this makes the bullet actually rise above the line of sight some distance from the muzzle. As it goes downrange, though, it is continually falling, and finally gravity overcomes the upward vector imparted at launch, and the bullet crosses the line of sight again.
This second crossing of the line of sight is the range at which you are zeroed. For most highpower rifles, at most common zero ranges, the first crossing occurs about 25 yards from the muzzle, give or take a few feet.