Code folding allows you to collapse a block of code – you can use it to focus on high-level structure without getting lost in the detail.
To enable code folding enable to option under the Script Editor section of Preferences, found under the File menu.
I use it with my user-defined functions to give me an overview of contents within an include file. Combined with appropriately placed comments this helps to summarise the contents of a library of functions. Here is an example: