Many people use a crate during potty training so that their dog cannot sneak off and potty in an illegal area.
I think "crate training" specifically is teaching your dog to tolerate the crate. It's a good idea to do this anyway in case you need to travel with your dog, take him to the vet, board him, etc.
I originally did not like the idea of using a crate for potty training because they spend a tremendous amount of time in there at first, but I found it to be invaluable tool. I pretty much made no progress with Thor for three weeks, and then got to 98% potty trained with the crate in three days.
Hope that explains it. Keep asking questions if it doesn't.
