It is showing all primary colors and all secondary colors, alternating, so that in CRT days, you could adjust the Red, Green and Blue to match the reference card.
The newer HDTV test is similar, but has a grey gradient (Black to white) along the bottom and some other HD specific marks.
As Georacer stated, Cathode Ray Tubes, the TV's and Displays that weigh 30 pounds or more, they may still be the standard in parts of the world.
If your computer monitor is set up correctly, you should see several shades of black at the lower right part of the HDTV screenshot above, as well as in the NTSC lower right corner, the NTSC are a little brighter so they are easier to pick out. So look at the NTSC Dark level adjustments to get an idea of where they are at, then compare them to the HDTV. You not only get more colors with HDTV, but more bandwidth between the brightest part on the display and the darkest part (high contrast ratio).
Prior to color TV, in the Black and White TV (greyscale, actually), they used the "Indian Head" to tune sets for best sharpness edge to edge (Attached).
A bit more on Test Patterns. The last coloured one iv burnt onto a DVD for testing DVD players & monitors. The picture was taken with a camera on an LCD tv. This is a PAL system.
Now we know what all the test patterns look like, in a SINGLE thread!
This should almost go to radio and comms as a sticky, once the details on how to generate the signals are posted, such as the frequencies listed on yours, and the "black levels" to tune for on my NTSC. The HDTV one I don't have much data at all, other than "Make it look like this".