In Project Management a baseline is a fixed point or snapshot which you can use to measure progress. At the start of a project a Baseline is taken of the project schedule, scope, and budget. Then during the project, the project manager can assess progress and performance against the baseline.
Any changes to the project baseline are managed through the project's change control process. This means that the baselines can change during the project lifecycle, but only in a controlled, documented way. Lots of changes to the project baseline can indicate problems with the project requirements, estimating or governance.
Setting the baseline is hugely important because you can't measure success without it. Projects are generally seen to be successful if they are delivered on time, to the scope and budget. You can't assess this if you don't have baselines for each. See also the Iron Triangle.