The featured module position is located on top of the main content area, below the top-banner position and above the newsflash position.
This area stretches out above the regular content, as you can see on this page without a sidebar.
To see what it looks like when there is a sidebar present, have a look at the All Module positions page.
The position can be styled to your liking in the CSS under #featured and .custom_hero-unit.
The featured position can be used to publish a custom HTML module (like the Bootstrap hero-unit used on this page - give it any content you want).
Or you can use an image rotator in this position to create a nice landing page. like (for example) Camera Slideshow module (available from the JED).