A reserve price is the lowest price a seller is willing to sell the item for. It should be higher than the minimum bid price and is usually kept secret from buyers. If your maximum bid is equal to or higher than the seller's reserve, your bid is raised to meet it.
Sellers use reserve prices to stimulate interest in their items.
By starting the bidding lower and adding a reserve price, the item will generally receive more bids. Please note that if you bid on a Reserve Price Auction and your bid does not meet the reserve, you have no obligation to purchase the item from the seller. See the paragraph above. Another bidder placed a higher maximum bid. When this happens, your bid will increase because eBay bids on your behalf up to your maximum bid.