Taunt will direct the target's attention from whoever it is on, onto the caster of taunt. Usually, a warrior, though druid bears have a similar spell.
Threat wise, this seems to put the warrior at the top of the list, but will not keep it there. More threat will have to be generated to keep a lead on damage dealers, or the mob will return to its previous target (or the next highest on the threat list).
This has, as it states, no effect if the mob is already targetting you, since you already have the most threat!
Some targets, usually bosses in instances or outdoor raid bosses, can be immune to this spell, making the warrior rely on other means to keep the target away from the raid.