When in a real estate contract this means that the Seller (or Landlord) is not responsibe for condition of the property, even for things that may be expected in other transactions. If you see this in your contract (and you are the buyer/tennant)… do your home work, get a proffessional to check everything out (ie. home inspector, building inpector, enviromental expert, structural engeneer etc.) You do not want to close a deal and realize there are huge problems that are going to cost you a fortune.
Reference: http://legal-dictionary.thefreedictionary.com/As-is