Torque is the measure of how much the shaft twists during the golf swing. It may be hard to imagine this even happening, but shafts are made with that particular fact in mind. They are even made to resist it more or less, depending on your swing and what kind of results you are looking for. It is measured by degrees; 1 for very little and 8 or more for a lot of twisting.
A steel shaft will have less torque simply because of the material it is made of. A degree of 3 to 4 is normal for a steel shaft. Graphite shafts can have a lot more torque. Since graphite is not a solid piece of material, the torque can be much higher; to degrees of 7 or 8.
When you have less torque in your club shaft, it is said that you will have a straighter shot and a stiffer feel. When you have more torque in your club shaft it is said that your shots can be less accurate but go further and have a nice soft feel.
When you strike the ball, you want your club head to be as square to your target as possible. When the club head twists, it can make the club head a degree or two open or closed when it makes contact. Therefore you want less torque when you are looking to straighten your ball flight.
When you have more torque in your club shaft, the twisting of the shaft can result in a ball flight slightly left or right of target. This also means you can hit the ball a little further, because at the time the club strikes the ball the torque can cause the club head to go faster.
There are pros and cons. You and your club-fitting specialist need to examine your swing and your wishes to get the right torque for you. This problem is usually bigger for the better players. Certainly Tiger Woods knows exactly how much torque he needs for every club in his bag, but for a beginner it won't matter much. Torque should be one of the last things you look at when trying to improve your game.