The idea is that you will set different values for production vs development. In this case the call to app.set() has two parameters key and value. It's up to you to define what keys and their corresponding values make sense for you application.
You might have something like this:
app.configure('production', function(){
app.set('db uri', 'bigdbserver/invoiceDB');
app.set('log level', 'warningsOnly');
});
app.configure('development', function(){
app.set('db uri', 'mylocalbox/invoiceDB');
app.set('log level', 'verbose');
});
updated: Added per Herman Junge's suggestion:
Per the Express documentation, app.configure will match to your NODE_ENV variable. This, you can set it up both ways, in the command line or inside your app:
Command Line
$ NODE_ENV=development node app.js
Inside my app
process.env.NODE_ENV = 'development';