Context:The conditions or circumstances in which something exists.
This word is often used to describe how a word can be understood by how it's used in a sentence. The context is the circumstances in which a word is used. It's the usage of the word, and the nearby words in the sentence. And when a word has multiple meanings, you can figure out which one it is by the context. It is also commonly used to describe when someone is literally quoted, but the sentence is taken out of its context where it can be properly understood.
Objectivists apply the term 'context' in many other situations, but it's the same principle. When you understand the circumstance in which something occurs, it provides you with a more specific usage and meaning. Knowledge is contextual. Statement of fact imply a specific set of conditions in order to be true. Statements of value are also contextual. If you were to say how a glass of water is of value, it implies ordinary circumstances. Obviously if you were drowning in a river it wouldn't be valuable at all.
It's important to understand what context is being assumed when a statement is made. Some of the worst mistakes in thinking occur when knowledge is removed from it's proper context. In a different context, the idea may not make any sense, may be contradictory, or may just be completely wrong. Keeping a focus on the context allows you to have a deeper understanding of an idea by relating it to its circumstances and identifying it's necessary conditions.