The context window is the AI's short-term memory for a single conversation. It sets a limit on how much text, counted in tokens, the model can consider at once, including your question and everything said so far. Once a conversation grows past that limit, the oldest parts start to fall out of view, which is why a very long chat can make an AI seem to forget what you said earlier.
For example, If you paste a 400 page book into a small context window, the AI can only 'see' a chunk of it at a time, not the whole thing.