/ignore is (as told elsewhere) the IRC command for ignoring users. It can also (in many IRC clients) be used to ignore specific types of IRC messages. It works entirely in client end.
/ignore is, again as pointed out, somewhat useless for ignoring users, mostly because it will get distracting when you can hear some people but not others. There are better ways to deal with troublemakers (see /kick and channel modes, +b). As usual, security is always at its best when it's done at the server end.
However, /ignore is not completely useless. If there's a channel that has a bot that floods the channel with news headlines (as in case of recent use of channel #coverage in SlashNet), it's best to make the client not to give distracting new messages about people joining, parting, and so on... In irssi, this is done by doing /ignore #coverage CRAP JOINS PARTS QUITS. | 
