The limits option can be used to 'fence in' drawing operations to a particular area. The figure below shows the command being used to keep operations inside the red rectangle.
In our view, the tool is of limited use in conventional work, but where it becomes necessary to reference in (say) a large map as a backdrop and you only want to work in a particular area of the map, it can be most useful.
In the example below, we want to restrict operation to the zone inside the red rectangle so the LIMITS command is invoked. We prevent zooming out side that area so a once set, a zoom extents takes the viewer to the required area and drawing information outside is ignored.