It is the temperature it turns something on or off at. Example if you set your heater to go on at 78 degrees and set a differential of 1 your heater would turn on at 78 and off at 79. If you set differential at 2 degrees it would turn on at 78 degreesand shut off at 80 degrees. When you buy a heater this is built in to it. If this was not set a heater would constantly turn on and off.
Just the opposite for cooling. If you set your fans to go on at 80 degrees and had the differential set at 1 it would shut them off at 79 degrees. A differential of 2 would shut the fans off at 78 degress and so on.
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