It probably upscales SD to HD.
Short answer: Upscaling is the conversion of a lower resolution video image (e.g. 720x480p) to a higher resolution (e.g. 1280x720p).
Longer answer (for a DVD player but the process is much the same):
Standard DVD Resolution
A standard DVD player, without upscaling, can output video resolution at 720x480 (480i). A progressive scan DVD player, without upscaling, can output 720x480 (480p - progressive scan) video signals.
480i represents 720 pixels displayed across a screen horizontally and 480 pixels down a screen vertically. This arrangement yields 480 horizontal lines, which are, in turn, displayed alternately. In other words, all the odd lines are displayed, followed by all the even lines.
480p represents 720 pixels displayed across the screen horizontally and 480 pixels down the screen vertically. This arrangement yields 480 horizontal lines on the screen, which are, in turn, displayed progressively, or each line displayed following another.
The Upscaling Process
Upscaling is a process that mathematically matches the pixel count of the output of the DVD signal to the physical pixel count on an HDTV, which is typically 1280x720 (720p) or 1920x1080 (1080i).
720p represents 1,280 pixels displayed across the screen horizontally and 720 pixels down the screen vertically. This arrangement yields 720 horizontal lines on the screen, which are, in turn, displayed progressively, or each line displayed following another.
1080i represents 1,920 pixels displayed across a screen horizontally and 1,080 pixels down a screen vertically. This arrangement yields 1,080 horizontal lines, which are, in turn, displayed alternately. In other words, all the odd lines are displayed, followed by all the even lines.