The options of UNIX® utilities usually are introduced with a dash (-) character.
This is problematic when a non-option argument has to be specified that begins with a dash. A common example for this are filenames.
Many utilities use the convention to specify two consecutive dashes (--) to signal "end of options at this point". Beyond this tag, no options are processed anymore, even if an argument begins with a dash.
Example: You want to list (ls) the file with the name -hello. With common option processing, this could end up in the ls-options -h, -e, -l and -o and probably in an error message about invalid options. You use this to avoid the wrong option processing:
ls -- -hello
POSIX® specifies that every utility should follow this rule (see ch. 12.2 Utility Syntax Guidelines), except
echo (historical reasons)test (obvious parsing reasons)